Debt-free companies perform better in bellwether market: Analysis

Conditions unlikely to ease soon with global, domestic interest rates on the rise

Companies that are able to finance their growth from internal accruals are doing significantly better than those depending on debt, shows an analysis of returns of companies that are part of the National Stock Exchange’s (NSE) bellwether Nifty50 index. 

Business Standard looked at companies shortlisted on the basis of their cash flows, debt levels and proportion of assets funded internally, rather than through debt. Companies scoring high on these factors outperformed the bellwether index even as it reached new highs, shows the analysis, which excluded finance companies. 

This analysis looks at returns from the beginning of 2013 to the present