Corporate diversification and refocussing by Indian business groups

Abstract

Strategies involving business groups and their diversification have been an interesting research area for academicians and corporate professionals. A lot of work has been done on understanding the effect the corporate diversification and refocusing by the business houses at a macro level, and their effect on the financial performance. This study studies the strategies of Indian business houses from 1988-2017, and attempts to capture the captures the changes in the diversification of these business houses and their super normal profits. Attempts have been made to bring out the relationship between diversification and profitability on a macro level. The hypothesis on the shape of the curve at time snapshots were tested, and the movement of the curves over time was evaluated to draw out insights.