scholarly journals Analysis of Factors Determining Capital Structure of Firms Listed in Colombo Stock Exchange in Sri Lanka

2021 ◽  
Vol 04 (11) ◽  
Author(s):  
M.B.M. Amjath ◽  
Keyword(s):  
Sri Lanka ◽  
Capital Structure ◽  
Firm Size ◽  
Negative Impact ◽  
Stock Exchange ◽  
Equity Capital ◽  
Debt Ratio ◽  
Endogenous Factors ◽  
Significant Negative Impact

Capital structure describes a mix of long-term debt capital and equity capital employed by a company to fund its operation and finance its assts. The objective of the study is to identify the determinants of the capital structure and examine whether each of the determinants have significant impact on capital structure. A sample of 25 beverage food and tobacco sector firms listed on Colombo Stock exchange(CSE) in Sri Lanka over the period of 2016 to 2020 were considered for the study. The independent variables such as profitability (PROR), firm size (FMSZ), tangibility (TANR) and liquidity (LIQR) and dependant variable such as long term debt ratio (LTDR), short term debt ratio (STDR) were used to measure the leverage level of the firms. The data were analysed and hypotheses were tested through regression analysis and correlation analysis by use of SPSS. Coefficient of regression used to identify the significant impact of each determinant against the endogenous factors. The investigation empirical findings reveals that firm size, tangibility and liquidity have significant negative impact on leverage level (STDR), while profitability has positive insignificant impact on leverage level (SDTR). On the other hand all four element have insignificant relationship with LTDR.

scholarly journals Ownership Structure, Corporate Governance and Capital Structure of Non-Financial Firms of Pakistan

2018 ◽  
Vol 10 (1) ◽  
pp. 31-46
Author(s):  
Hassan Ahmad ◽  
Nasreen Akhter ◽  
Tariq Siddiq ◽  
Zahid Iqbal
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Ownership Structure ◽  
Negative Impact ◽  
Institutional Ownership ◽  
Board Independence ◽  
Managerial Ownership ◽  
Debt Ratio ◽  
Significant Negative Impact ◽  
The Impact

This study is undertaken with the purpose of investigating the impact of ownership structure and corporate governance on the capital structure of Pakistani listed firms from 2011-2014, feasible general least square is used to investigate the impact of ownership structure and corporate governance on capital structure of KSE 100 index firms. Explanatory variables include ownership concentration, managerial ownership, foreign ownership, institutional ownership, board size, board independence and CEO duality along with the three control variables namely firm size, firm profitability and liquidity. There is insignificant positive relationship between ownership concentration and capital structure, managerial ownership has a significant negative impact on debt ratio. Foreign ownership has also a significant negative impact on firm capital structure and institutional ownership has significant positive impact on capital structure. Board size is positively related to capital structure, board independence also positively related to firm’s debt ratio but CEO duality negatively related to the dependent variable, all these variables have significant impact on capital structure of Pakistani firms. 

scholarly journals Impact of Capital Structure on Firm’s Performance: Focusing on Non-financial Listed Egyptian Firms

2019 ◽  
Vol 10 (6) ◽  
pp. 78 ◽  
Author(s):  
Ahmed Sakr ◽  
Amina Bedeir
Keyword(s):  
Capital Structure ◽  
Negative Impact ◽  
Short Term ◽  
Total Debt ◽  
Significant Negative Impact ◽  
Two Measures ◽  
Independent Variable ◽  
Measure Of Performance ◽  
The Impact

The purpose of this paper is to investigate the impact of capital structure decisions on the performance of the firm. The investigation has been performed using a data of 62 listed non-financial Egyptian firms over a period of fourteen years from 2003-2016. This study used two measures for performance the dependent variable which are ROA and ROE, the most common used measures agreed upon on the majority of previous studies. Whereas, for the independent variable “the capital structure, the study uses the three measures of capital structure which are total debt to total assets (TD), total short-term debt to total assets (STD), and total long-term debt to total assets (LTD). The results showed when using ROA as a measure of performance, a significant negative impact of capital structure (TD, STD, and LTD) exists; while in case of using ROE as a measure of performance, there’s a significant negative impact of capital structure only when using STD, otherwise a positive significant impact of capital structure exist.

The Effect of Capital Structure, Size and Revenue Growth on the Effectiveness of Garment Businesses Listed on Vietnam’s Stock Market

2019 ◽  
Vol 35 (4) ◽  
Author(s):  
Do Huy Thuong ◽  
Tran Luu Ngoc ◽  
Nguyen Thi Phuong Hong
Keyword(s):  
Stock Market ◽  
Capital Structure ◽  
Firm Size ◽  
Business Performance ◽  
Negative Impact ◽  
Short Term ◽  
Return On Equity ◽  
Revenue Growth ◽  
The Impact

Considering the impact of the capital structure on the effectiveness of businesses is extremely important. Therefore, this study is conducted in order to find the influences of capital structure, firm size and revenue growth on the performance of the garment businesses listed on Vietnam stock market in the period of 2013-2018 with the representation of return on equity (ROE). The research with the use of panel data has shown that the ratio of short-term debt on total assets, the firm size and the revenue growth all have positive impacts on business performance. Meanwhile, the ratio of long-term debt on total assets has a negative impact on the performance of garment businesses at the statistically significant level of 5%.

Nigeria Ailing Industries and the Capital Structure Theory: A Need for Concern

2013 ◽  
Vol 03 (08) ◽  
pp. 31-40
Author(s):  
Ajeigbe Kola Benson ◽  
Fasesin Oladipo Oluwafolakemi ◽  
Ajeigbe Omowumi Monisola
Keyword(s):  
Capital Structure ◽  
Firm Size ◽  
Stock Exchange ◽  
Capital Intensity ◽  
Structure Theory ◽  
Debt Ratio ◽  
Manufacturing Companies ◽  
Explanatory Variables ◽  
Tax Shield ◽  
Total Debt

It is necessary to identify that what are factors contribute to the firms’ capital structure composition in its operation. Hence the present study was undertaken with the objective of finding out the relationship between capital structure determinants and ailing manufacturing firms of the listed companies in Nigeria. Using a multiple regression analysis, ailing manufacturing companies in Nigeria stock exchange market was examined for the period of 2005-2010. The final sample consists of 14 manufacturing companies. In this study, dependent variable that is, leverage level of the companies, is measured by long-term debt ratio, short term debt ratio and total debt ratio. Capital structure determinants (independent variables) are measured by capital intensity, tangibility, profitability, firm size and non- debt tax shield. Findings showed that the direction of the explanatory variables such as tangibility, profitability, firm size and non-debt tax shields with total debt largely consistent with the explanations of trade-off theory and prove past empirical findings also.

scholarly journals Relationship Between Capital Structure and Stock Returns of Jordanian Commercial Banks

2020 ◽  
Vol 13 (2) ◽  
pp. 100
Author(s):  
Sufian Radwan Al-Manaseer
Keyword(s):  
Capital Structure ◽  
Stock Returns ◽  
Firm Size ◽  
Commercial Banks ◽  
Negative Impact ◽  
Positive Impact ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
The Impact ◽  
The Relationship

This study aims to analyze the relationship between capital structure and stock returns of Jordanian banks listed on the Amman Stock Exchange from 2009 to 2018. The study sample is composed of 13 commercial banks in Jordan. The e-views program is used to conduct the statistical analysis of study variables. Initially, a simple linear regression analysis is conducted to determine the impact of capital structure as measured by financial leverage on stock returns and vice versa. Then, several control variables are added: growth in assets, liquidity, firm size, and profitability. This study has found that growth, capital structure, and profitability have a positive impact on stock returns. By contrast, liquidity and firm size have a negative impact on stock returns. Stock returns and firm size have a positive impact on capital structure, whereas liquidity, growth, and profitability have a negative impact on capital structure.

scholarly journals Pengaruh Audit Internal, Struktur Modal, Dan Good Corporate Governance Terhadap Kinerja Keuangan

2020 ◽  
Vol 2 (1) ◽  
pp. 2001-2019
Author(s):  
Amara Meidiana ◽  
Erinos NR
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Financial Performance ◽  
Sampling Method ◽  
Negative Impact ◽  
Positive Impact ◽  
Stock Exchange ◽  
Internal Audit ◽  
Good Corporate Governance ◽  
Significant Negative Impact

Economic growth according to business field said that financial sector in 2016 to 2018 were decreased year by year. It indicates that there was a financial performance’s decline in financial sector’s companies. In order to increase financial performance, we need to find out factors that could accelerate financial performance’s potential. Internal audit, capital structure, and good corporate governance are independent variables that will be tested in this research for their impacts on financial performance. This research uses ROA, ROE, & NPM combination as internal audit’s proxies and DAR, DER, & LDER as capital structure’s proxies which are still minor in prior researchs. The purpose of this research is to test how far internal audit, capital structure, and good corporate governance could affect financial performance partially. This research was tested on financial sector’s companies that listed on Indonesia Stock Exchange in 2016 to 2018 with 129 samples using purposive sampling method with judgment. The results of this research proved that internal audit had insignificant positive impact on financial performance, capital structure had significant negative impact on financial performance, while good corporate governance had significant positive impact on financial performance with significant level 0,005 which is had not reach the maximum standard 0,05 yet.

scholarly journals FAKTOR–FAKTOR YANG MEMPENGARUHI STRUKTUR MODAL PADA PERUSAHAAN OTOMOTIF YANG TERDAFTAR DI BURSA EFEK INDONESIA

2019 ◽  
Author(s):  
Nur Istiqomah ◽  
Aminar Sutra Dewi
Keyword(s):  
Capital Structure ◽  
Firm Size ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Multiple Linear Regression Analysis ◽  
Factors Affecting ◽  
Insignificant Effect ◽  
Optimal Capital ◽  
The Capital Structure

This assessment intends to analyze the factors affecting the capital structure. Automotive companies must have optimal capital and maximum corporate finance in order to obtain satisfactory results and avoid bankruptcy. The purpose of this study is to determine the effect of firm size on the capital structure, the influence of liquidity on the capital structure and the effect of profitability on the capital structure listed on the Indonesia Stock Exchange with a two-year study period, 2013 to 2016. With a sample of six companies, using a proposive sampling. The analysis method used is multiple linear regression analysis. The results showed that firm size did not have a positive and insignificant effect on capital structure, liquidity had positive and insignificant effect on capital structure, and profitability had no positive and insignificant effect on capital structure. Because profitability had increased, there is a decrease for long-term debt repayment.

scholarly journals FAKTOR-FAKTOR PENENTU STRUKTUR MODAL PERUSAHAAN NON KEUANGAN YANG TERDAFTAR DI BURSA EFEK INDONESIA

2014 ◽  
Vol 7 (2) ◽  
pp. 273
Author(s):  
Wulansari Dewi ◽  
Henny Setyo Lestari
Keyword(s):  
Capital Structure ◽  
Hypothesis Testing ◽  
Firm Growth ◽  
Sampling Method ◽  
Stock Exchange ◽  
Debt Ratio ◽  
Short Term ◽  
Total Debt ◽  
Size Firm

<p>This research discusses whether there are effect of capital structure on leverage. Independent<br />variable consist of firm size, firm growth, tangibility of assets, profitability, and risk. Dependent<br />variable divided into 3 indicators such as total debt ratio, long term debt ratio, and short term<br />debt ratio. The study consisted of 164 nonfinancial industries, which was obtained from official<br />website of Indonesia Stock Exchange (http://www.idx.co.id). The sampling method used in this<br />study was purposive sampling and data analysis method used for hypothesis testing is linear<br />regression analysis. The results of hypothesis testing showed that there is influence between<br />capital structure on total debt ratio and short term debt ratio. But not too significantly to long<br />term debt ratio. The contribution of this study hopefully can help managers and investors alike<br />to make a right decision in nonfinancial industry in Indonesia.<br />Keywords: capital structure, growth, long term debt ratio, risk, ROA, short term debtratio, size,<br />tangibility of assets, total debt ratio.</p>

scholarly journals The Impact of Capital Structure on the Profitability of Publicly Traded Manufacturing Firms in Bangladesh

2019 ◽  
Vol 6 (2) ◽  
pp. 1 ◽  
Author(s):  
Md. Ataur Rahman ◽  
Md. Sadrul Islam Sarker ◽  
Md. Joyen Uddin
Keyword(s):  
Capital Structure ◽  
Negative Impact ◽  
Positive Impact ◽  
Manufacturing Firms ◽  
Debt Ratio ◽  
Manufacturing Companies ◽  
Publicly Traded ◽  
Significant Negative Impact ◽  
Equity Ratio ◽  
The Impact

This research explores the impact of capital structure on the profitability of publicly traded manufacturing firms in Bangladesh. In this paper, we applied the fixed effect regression to find out the correlation among independent variables (debt ratio, equity ratio and debt to equity ratio) and dependent variables (return on asset, return on equity and earnings per share). A sample of 50 observations of selected 10 manufacturing companies listed in Dhaka Stock Exchange has been analyzed over the period of 2013 to 2017. This research reveals that the debt ratio and equity ratio have a significant positive impact but debt to equity ratio has a significant negative impact on ROA. This paper also exposes that, equity ratio has a significant positive impact but debt to equity ratio has a significant negative impact on ROE. Finally, debt and equity ratio has a significant negative impact on EPS. Findings of this research will help the listed manufacturing companies to maintain an optimum capital structure which will lead to the maximization of stockholders wealth.

scholarly journals PENGARUH KOMPONEN STRUKTUR MODAL TERHADAP PROFITABILITAS PERUSAHAAN DENGAN UKURAN PERUSAHAAN SEBAGAI VARIABEL KONTROL (STUDI EMPIRIS PERUSAHAAN MANUFAKTUR DI INDONESIA)

2017 ◽  
Vol 2 (2) ◽  
pp. 152
Author(s):  
Dian Pratiwi ◽  
Hartirini Warnaningtyas
Keyword(s):  
Regression Analysis ◽  
Capital Structure ◽  
Firm Size ◽  
Stock Exchange ◽  
Research Use ◽  
Manufacturing Firm ◽  
Empirical Results ◽  
Total Capital

AbstractThe relation between capital structure and profitability are important to investigate because the improvement of profitability is necessary to predict the long-term survivability of firm. This paper also extend Abor’ s findings (2005) regarding the effect of capital structure on profitability by examining on Indonesian manufacturing firm that listing on Indonesian Stock Exchange. This research use regression analysis to estimate the relation between EBIT and capital structures. Empirical results show that long debt to total capital and size has significantly relationship with profitability. Otherwise, short debt to total capital has no significant effect on profitability.Keywords: Capital structure, profitability, Firm Size AbstrakHubungan antara struktur modal dan profitabilitas maih menarik untuk diteliti karena peningkatan profitabilitas diperlukan untuk memprediksi kelangsungan hidup jangka panjang perusahaan. Penelitian ini dilakukan dalam rangka memperluas temuan Abor (2005) mengenai pengaruh struktur permodalan terhadap profitabilitas dengan memeriksa perusahaan manufaktur Indonesia yang terdaftar di Bursa Efek Indonesia. Penelitian ini menggunakan analisis regresi untuk memperkirakan hubungan antara profitabilitas yang diturunkan dari nilai EBIT dan struktur permodalan. Hasil empiris menunjukkan bahwa hutang jangka panjang dan ukuran memiliki hubungan yang signifikan dengan profitabilitas. Sementara, hutang jangka pendek tidak berpengaruh secara signifikan terhadap profitabilitas perusahaan.Kata kunci: struktur modal, profitabilitas, ukuran perusahaan.

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