مجلة البشائر الاقتصادية
Volume 10, Numéro 3, Pages 419-434
2024-12-14
The Effect Of Debt-based Financing Structure On The Market Value Of Companies: A Sample Case Study Of Companies Listed On The Malaysian Stock Exchange In The Period Between 2001 And 2023
Authors : Messaoud Fatima Zahra . Baroudi Naima .
Abstract
: The research paper examines how the structure of debt financing affects the market value of companies in the industrial sector listed on the Malaysian Stock Exchange from 2001 to 2023. A panel data model was used to analyse the relationships among various variables. Market capitalization is the dependent variable, while the debt-to-assets ratio, long-term debt-to-assets ratio, debt-to-equity ratio, and inflation rate are independent variables. Control variables include firm size, return on assets (ROA), firm growth, and current ratio. The findings indicate that the debt-to-assets ratio, firm size, and liquidity ratio positively affect market value, while the other variables have a negative effect. Based on the Housman test results, the random effects model was chosen for data analysis. This study highlights the significance of debt financing structure in enhancing corporate market value and provides recommendations for financial managers, investors, and policymakers on effective financing strategies to boost corporate value.
Keywords
debt-financing structure, market value of companies, Malaysia Stock Exchange, debt to asset ratio
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