THE RELEVANCE OF R & D SPENDING TO THE BRAZILIAN CAPITAL MARKET: A STUDY OF ELECTRICITY DISTRIBUTION IN THE PERIOD 2002 TO 2009 DOI:10.5773/rai.v8i2.703

Abstract

This article aims to analyze the value relevance of R&D expenditures for the capital market of companies from the electricity distribution sector in the period 2002-2009. Positivist and empirical research was conducted with non-probabilistic sampling procedure, with a naturally restricted universe since the companies were chosen from a list of electricity distribution companies traded on São Paulo Stock Exchange. A regression analysis (pooling) of R&D expenditures as function of the market value of the companies under analysis was applied, with control variables as the net income (LL) and equity (PL). The results show that the information of R&D expenditures is relevant to the capital market when analyzed separately. When this information is regressed with the control variables LL and PL it is observed that despite the improvement in the adjusted R², the variable R&D is not significant at 5%. A comparison of this regression with a regression of market value factoring only the control variables it is perceived that the Wald's test is not captured marginal gain in the informational level of LL and PL with the addition of R&D expenditures information. It is concluded that the R&D expenditures information does not add marginal informational content in an attempt to explain the market value of companies from their financial information of LL and PL.