INTERNATIONAL JOURNAL OF ENGINEERING MANAGEMENT AND
SOCIAL SCIENCES

Short-Window Market Reactions to Real Estate Mergers and Acquisitions: A Comparative Study of Pre- and Post-Performance

This study examines short-window stock market reactions surrounding the announcement of the merger between Indiabulls Real Estate Limited (IBREL) and the Embassy Group, announced on 18 August 2020 and later completed as Embassy Developments Limited, with the objective of evaluating whether the announcement created short-term shareholder value. Mergers and acquisitions have become an important strategic tool for real estate companies seeking growth, land-bank consolidation, and operational synergies, and understanding how investors react around such announcements provides evidence on market efficiency and wealth effects. The study covers a 21-trading-day event window (10 days before and 10 days after the announcement date), with a 10-day estimation window preceding it used to model expected returns via the Market Model, benchmarked against the Nifty Realty Index. Abnormal Returns (AR) and Cumulative Abnormal Returns (CAR) are calculated for each trading day in the event window, and a one-sample t-test and a paired-samples t-test are used to evaluate the significance of the reaction before and after the announcement. The findings indicate that abnormal returns were concentrated in the pre-announcement period rather than the post-announcement period, with the paired-samples t-test showing a statistically significant difference between the two, while post-announcement AR was not significantly different from zero. This suggests that the market had substantially anticipated the merger before its formal announcement. The study contributes case-based empirical evidence on short-window wealth effects in Indian real estate M&A and is useful to investors, financial analysts, corporate managers, and researchers. Keywords: Mergers and Acquisitions, Real Estate, Event Study, Abnormal Return, Cumulative Abnormal.