Abstract:
This research paper examines the market efficiency of loss earned listed
manufacturing companies to assets write down announcement and test
whether there was semi-strong form of market efficiency available in
Colombo Stock Exchange (CSE) under the circumstances. This study attempts
to answer the research question of are the loss making companies’ impairment
of non- current assets announcements impact to share market? This issue is
examined using an overall sample of 62 events relating to 22 listed
manufacturing companies covering the period from January 2007 to
December 2014. From the events, 12 events were considered to analyse the
loss earned 10 listed manufacturing companies market efficiency. The
standard Event Study Methodology (ESM) is adopted in order to carry out the
study. This study finds that assets write down announcement impact on share
prices of loss earned listed manufacturing companies at the level of 01% on
the event date. It reveals that CSE has supported to the semi strong form
market efficiency which is run on publicly available information on CSE.
