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Can DuPont Analysis Predict Voluntary Delisting from Stock Exchange? Evidence from Pakistan

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COMSATS University Islamabad, Pakistan, Hussain Khan, Muhammad Nadir, Ali, Haji Suleman·2019·Jinnah Business Review
DOI 10.53369/ofjk7670
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Abstract

This study explores whether voluntary delisting of companies from stock exchanges can be predicted by the DuPont Model. ROE (Return on Equity), NPM (Net Profit Margin), ATO (Assets Turnover) and LM (Leverage Multiplier) of 13 voluntarily delisted firms from Karachi Stock Exchange were compared with same ratios of respective sectors for 6 years preceding the delistment year by applying t-test. Difference of means of DuPont ratios between voluntarily delisted firms and their respective sectors were not found statistically significant. Thus, ROE, NPM, ATO and LM, which are the measures of profitability, asset utilization (efficiency) and leverage respectively, are not the significant predictors of voluntary delisting decisions in Pakistan. To the best of researchers knowledge, this study is first attempt to differentiate between voluntarily delisted and listed companies on the basis of DuPont Model.

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Authors
COMSATS University Islamabad, P., Hussain Khan, M. N., & Ali, H. S.
Affiliations
COMSATS University Islamabad (PK)
ORCID
Ali, Haji Suleman
Venue
Jinnah Business Review
Publisher
Capital University of Science and Technology Islamabad
Published
2019-07-01
Volume
7
Issue
2
Pages
41-48
ISSN
  • 2070-0296 (ISSN-L)
  • 2307-7921
DOI
10.53369/ofjk7670
OpenAlex
W3196650950
Cited by
1
References
0
Citations by year
2026: 1
FWCI
0.00
Type
journal article
Language
en
Open access
Licence
cc-by
Locations
Jinnah Business Review (publishedVersion, cc-by)
Topics
  • Social Sciences › Business, Management and Accounting › Accounting › Financial Analysis and Corporate Governance
  • Social Sciences › Business, Management and Accounting › Accounting › Corporate Finance and Governance
  • Social Sciences › Business, Management and Accounting › Accounting › Financial Distress and Bankruptcy Prediction
Keywords
voluntary delisting, Du Pont system, financial ratios, return on equity, net profit margin, asset turnover, Karachi Stock Exchange, listed companies, Pakistan

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