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Introduction
Firms are crucial to an economy's effective operation. The firm's value is a widely accepted parameter to signal the sustainability of a firm's business activity. Hence, it is an essential determinant for all the concerned stakeholders for making their economic and financial judgements. In general, the ups and downs, we observe in economies during different periods are directly related to the impact of these firms of varying nature and sizes. The firm's value keeps on changing over time. Many factors (internal or external to firms) are present in the business environment that directly and significantly impact the firm's value, such as Corporate Governance (CG), Market Size, Financial Distress (FD), and Bankruptcy. The firm’s external factors are not in the firm's control. However, internal factors can be controlled by taking proper and timely actions. The firm's FD situation is a critical factor for the firm's smooth business process [52]. Additionally, information disclosure with transparency is also an essential element for the stakeholders [53]. Hence, Financial Distress, Transparency, and Disclosure are variables which we will include in our study.
Financial distress, often known as FD, is a word used to describe an unfavorable financial situation in which a company faces challenges with its cash flow and has difficulty paying its debts in full, leading to the firm's closure [52]. When a company struggles to preserve liquidity and subsequently betrays the creditors' faith, it is considered distressed [25]. According to Aksu and Kosedag [3], a good Transparency and Disclosure (T&D) mechanism should protect the rights of minority shareholders and creditors, reduce informational asymmetry within the company and the likelihood of fraud, increase the likelihood that fraud will be more easily detected, lower the cost of capital, and ultimately increase the value of the firm [3]. Cases like IL&FS, DHFL, Jet Airways defaults, and many more have proved that there is still a lot to be known about the financial health of the companies in India. All these distressed companies, at one time, were one of the major giants in their respective areas. But something went wrong within them, ultimately causing either the company's insolvency or a large loss to creditors and investors in the form of a decline in the value of the firms' shares and assets....