The aim of this report is to examine the geographical diversification and its effect on the company’s performance. Also the report analyse the effect of economy on both the corporate side and the geographical diversifications of the firm. For this the sample observations regarding the diversifications effect for the year 1990 to 1999 were observed. It can also be noted that location strategy were analysed for diversification effect on the firm. From this analysis we find that geographical diversifications and industrial diversifications all are associated with the firm value. The two diversification factor country and regional were analysed with the local strategy and the economic effect on the firm.
International diversification and local strategies for the firm results in the product development and company’s performance and find that the S-curve is a more complete approach for the firm. Also we find that geographical diversified firms have more Research & Development expenditures, operating expenses, advertising expenditures with higher ROE & ROA than other industrially oriented firms.