Phasin Wanidwaranan

This paper examines the market value added (MVA) of listed companies in Thailand. It is known that the major drawbacks of MVA are size and market return effects. Using the two additional approaches to improve MVA study – MVA change, and the market return adjusted of three-year growth rate of MVA – the better interpretations of MVA in the Thai market during 1999–2018 are obtained. The first approach reduces the market capitalization bias, while the second diminishes the effect of the overall market trend and the stability of firm’s current performance. This study finds that when the two alternative techniques are applied, the annual results of the MVA rankings are not consistent with those of the traditional MVA and thus lead to a new insight into such indicator. Therefore, this study advances the understanding of the market value added and value creation indicators.