Choice of Diversification Strategies in an Emerging Market: Evidence from Indian Manufacturing Industries

The study seeks to measure the strategic choice of industries over different dynamic phases in the Indian economic environment. The total sample of 536 companies has been divided into 14 industries as per Standard Industrial Classification (SIC) codes. The paper also categorizes companies as per the cyclical changes in the economy, that is, growth, cyclical, and defensive industries. Evidence suggests that choice of diversification is industry specific and concurrently affected by the environmental conditions prevailing in the emerging economy. Food and beverages, plastic/rubber, and electrical equipment industries follow higher categories of diversification than other industries.