Abstract
In this paper we have tried to find out the effectiveness of EVA in selected Indian companies. During last decade, value added measures like EVA has gained popularity and companies around the world have started disclosing EVA figures in their financial statements, as a part of corporate social responsibility agenda. This is because of shifting corporate objective from profit maximization to value or wealth maximization. The paper examines whether selected companies are able to create value for their shareholders or not. For this, performance of selected companies has been analyzed using traditional performance measures such as ROCE, ROE and EPS alongwith value added measures called EVA. With the help of various statistical techniques like Regression, Trend analysis, Chi square and ANOVA, the present study tests the various hypotheses and reveals that except for few, majorities of the sample companies are able to continuously create value for their shareholders during the study period. Study provide that EVA is gaining popularity in India as important measures of firm performance and more companies should disclose EVA figures in their financial report so as to reveal correct financial position to the various stakeholders.
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