Effect of Product Pricing on Equity Return of Manufacturing Firms Listed at Nairobi Securities Exchange in Kenya
Charles Njure Kimondo *
School of Business, Jomo Kenyatta University of Agriculture and Technology, Kenya.
Joshua Matanda Wepukhulu
School of Business, Jomo Kenyatta University of Agriculture and Technology, Kenya.
Oluoch Oluoch
School of Business, Jomo Kenyatta University of Agriculture and Technology, Kenya.
*Author to whom correspondence should be addressed.
Abstract
Purpose of Study: The study aimed to assess how product pricing affects the equity return of manufacturing firms listed at the Nairobi Securities Exchange in Kenya.
Research Design: The study employed both longitudinal and cross-sectional research designs.
Place and Study Duration: the study covered manufacturing firms listed at Nairobi Securities Exchange in Kenya. Data was collected from the year 2008 to the year 2021.
Research Methodology: The study's target population included 7 listed manufacturing companies in the Nairobi securities exchange. The current study relied on secondary data sources for the period between the year 2008 and year 2021 that was gathered from the Nairobi Securities Exchange, the capital market authority library and the annual reports of individual companies that were obtained from their websites. Descriptive and inferential measurements were used to evaluate the secondary data. Descriptive statistics comprised the mean and the standard deviation. Inferential statistics on the other hand comprised panel regression and Pearson's product-moment correlation analysis. Analysis was conducted using Stata 14 software to produce tables, graphs, charts, diagrams and statistical parameter estimates.
Results: The findings showed that product pricing has a positive influence on the equity returns of listed manufacturing firms in the Nairobi Securities Exchange. Also, the influence was found to be significant. This meant that product pricing had a positive significant influence on the equity returns of listed manufacturing firms in the Nairobi Securities Exchange. The study, therefore, rejected the null hypothesis and concluded that product pricing has a positive significant influence on equity returns of listed manufacturing firms in the Nairobi Securities Exchange.
Conclusions: According to the study's findings, product price has a favourable impact on the equity returns of manufacturing companies listed on the Nairobi Securities Exchange. The impact was also shown to be substantial. This indicated that product pricing had an important beneficial impact on the equity returns of manufacturing companies listed on the Nairobi Securities Exchange.
Keywords: Equity return, manufacturing firms, Nairobi securities exchange, product pricing
How to Cite
Downloads
References
Libanio G, Moro S. Manufacturing industry and economic growth in Latin America: A Kaldorian approach. Second Annual Conference for Development and Change Campos Do Jordão, Brazil. 2007;1-25.
Elhiraika AB. Promoting manufacturing to accelerate economic growth and reduce volatility in Africa; 2008.
Retrieved January, 10, 2013.
Odhiambo W. The manufacturing sector in Kenya: an empirical analysis (Doctoral dissertation, University of Nairobi); 1991.
Kenya Association of Manufacturers. Facts and Figures; 2022.
Cadez S, Guilding C. An exploratory investigation of an integrated contingency model of strategic management accounting. Accounting, Organizations and Society. 2008;33(7):836-863.
Sulanjaku M, Shingjergji A. Strategic cost management accounting instruments and their usage in Albanian Companies. European Journal of Business, Economics and Accountancy. 2015;3(2):44-50.
Kumar A, Nagpal S. Strategic cost management-suggested framework for 21st Century. Journal of Business and Retail Management Research. 2011;5(2): 118–130.
Langfield-Smith K. Strategic management accounting: How far have we come in 25 years? Accounting, Auditing & Accountability Journal. 2008;21(2):204-228.
Kenya Association of Manufacturers. Facts and Figures; 2018.
Thompson AA, Strickland AJ, Gamble JE. The quest for competitive advantage: concepts and cases. New Delhi: McGraw-Hill; 2009.
Donaldson L. The Contingency Theory of Organizations. Sage, Thousand Oaks; 2001.
Hofstede G. The Game of Budget Control. Assen, Neth: VanGorcum and London: Tavistock; 1967.
Gerdin J, Greve J. Forms of contingency fit in management accounting research—a critical review. Accounting, Organizations and Society. 2004;29(3):303-326.
Oates G. Literature review and synthesis of management control systems: In the Context of the Public Sector. International Journal of Business and Management. 2015;10(2):52–57.
Wuollet J. Pricing strategy and revenue models: A multiple case study from the IT service sector in Finland. (Doctoral dissertation, Aalto University); 2013.
Ritz W. The Effects of Pricing on the Sales Force and the Firm: A Strategic View. (Doctoral dissertation, Kennesaw State University); 2013.
Liozu SM, Hinterhuber A. Pricing orientation, pricing capabilities, and firm performance. Journal of Management Decision. 2013;51(3):594-614.
Jack L. The adoption of strategic management accounting tools in agriculture post subsidy reform: A comparative study of practices in the UK, the US, Australia and New Zealand. Chartered Institute of Management Accountants. 2009;5(7):1-7.
Baker M, Wurgler J. Investor sentiment and the cross‐section of stock returns. The Journal of Finance. 2006;61(4):1645-1680.
Dudu OF, Agwu ME. A review of the effect of pricing strategies on the purchase of consumer goods. International Journal of Research in Management, Science & Technology. 2014;2(2):88-102.
Nyariki RN. Strategic management practices as a Competitive tool in enhancing performance of Small and medium enterprises in Kenya (Doctoral dissertation, University of Nairobi); 2013.
Oke MO, Olarewaju OM, Ayooluwade E. The relevance of pricing strategies on corporate performances in Nigeria. International Journal of Economics, Commerce and Management. 2016;4(1): 475–488.