R&D Spending and Share Price of Listed Companies in the Stock Exchange of Thailand
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Abstract
The study’s main objective aimed to examine possible relationship between research and development (R&D) spending and common share price of listed companies from the Stock Exchange of Thailand (SET). Using stratified random sampling, 210 corporate annual reports of seven industries from the SET were used as the samples. Corporate annual reports during 2016 to 2018 were used to collect R&D spending and corporate characteristics, while SETSMART was used to collect common share price of samples. Descriptive analysis, correlation matrix and panel data analysis were used to analyze the data. As the results, the study found a significantly negative relationship between R&D spending and common share price at 0.05 level, and there was significant relationship between firm size, firm age, audit type, risk, profitability, and share price at 0.05 and 0.01 levels. Using sensitivity analysis, this study found that there was a significantly negative relationship between development spending and common share price at 0.05 level, while no correlation was between research spending and share price at 0.05 level. This study demonstrated that the theory of stock investment and speculator can be used to explain a negative relationship between R&D spending and share price of listed companies in the SET as well as a negative relationship between development spending and share price.
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