Assessment of the Financial Competitiveness of Publicly Listed Indian Real Estate Companies Using the Entropy Method

TL;DR

This paper develops an index system to evaluate the financial competitiveness of Indian publicly listed real estate companies, using financial ratios to assess profitability, solvency, and operational capacity, providing insights into their strengths and weaknesses.

Contribution

It introduces a comprehensive evaluation index system specifically tailored for Indian real estate firms, integrating multiple financial metrics for competitiveness analysis.

Findings

High-scoring companies exhibit strong profitability and operational capacity.

Lower-scoring companies face challenges in solvency and working capital.

The index system effectively differentiates financial strengths among firms.

Abstract

The real estate sector is one of the key drivers of India's national economy, contributing about 7.3\% to the GDP. As the market evolves, more players enter, and government policies become more stringent, Indian real estate companies face increasing competition. Improving financial competitiveness is crucial for the survival and growth of these companies. This paper presents a financial competitiveness evaluation index system for Indian-listed real estate companies, covering profitability, solvency, and operational capacity. Using key financial ratios and a scoring system, the financial competitiveness of various companies was evaluated, revealing that companies with high scores have strong profitability and operational capacity. In contrast, those with lower scores struggle with solvency and working capital.