A study on required rate of return of IT industry in Bangladesh for better investment decision

Abstract

The IT business has shown to be the fastest expanding industry in recent years. Every industry was negatively affected by the Covid-19 pandemic. The epidemic, on the other hand, had the opposite effect on the IT industry. Though people are returning to on-site employment following the pandemic. However, there are still a few jobs and tests that are done remotely. Proper local and international investments are required to boost the sector's growth. For this reason, that this study has been undertaken. An introduction is presented at the start of the paper that goes over the thesis's purpose in detail. The next step was to conduct a systematic literature review (SLR). Previous relevant articles have been subjected to a systematic literature review. The SLR approach is used because it gives in-depth understanding of a topic and answers research questions. The following section is methodology. All of the material, articles, and data have been found on the internet. As a result, the study employs a secondary research analysis strategy. The purpose of this article is to use the Capital Asset Pricing Model to compute the required rate of return for each IT company by examining the stock price (CAPM). This in-depth research will aid investors in determining which firm is the best to invest in and which will offer them with a high return on their investment. The study used the stock prices of each IT business over the previous two years to compute monthly returns. The two-year monthly returns of the Dhaka Stock Exchange have also been estimated. Following that, market risk, or Beta, was determined for each IT business using regression analysis. These all are in analysis and findings part. A thorough summary of the paper is given and required recommendations. Last but not least, a list of all preceding publications is presented, which were quite useful in finishing the thesis.