Modelling the impact of intellectual capital on financial performance: a case of Indian IT companies

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Published Jul 12, 2024
DOI: https://doi.org/10.13165/IE-24-18-1-02

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Nisarg Joshi
Institute of management, nirma university
https://orcid.org/0009-0002-1647-9266 Ansita Aggarwal
Jaipuria Institute of Management, Jaipur, India
https://orcid.org/0000-0002-2510-2025

Abstract

Purpose: This research aims to study the impact of the intellectual capital of selected listed IT companies in India on their financial performance.
Design/Methodology/Approach: This study includes a sample of the ten Indian IT companies’ constituents of Nifty – IT index from 2011 to 2022. PLS-PM analysis has been employed to identify the intellectual capital components that predict the firm's performance and the effect of intellectual capital components on the firm's financial performance.
Findings: The findings suggest that intellectual capital affects company performance and can, to varied degrees, predict it. The path model results validate the model fit and provide compelling evidence for the Intellectual Capital framework's theoretical underpinnings. The study offers evidence from the Indian IT sector that intellectual capital significantly impacts performance.
Originality/Value: This study examines the financial performance of selected IT companies in India for investigating the impact of intellectual capital on financial performance. It offers additional insights for intellectual capital in predicating the firm performance.


Keywords: IT Companies, Nifty-IT, VAIC, PLS-PM, Intellectual Capital, Firm Performance

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Issue
Vol. 18 No. 1 (2024): Intellectual Economics
Section
Articles
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