The Influence of Profitability, Liquidity, and Company Size on Debt Policy in Energy Sector Manufacturing Companies on the Indonesia Stock Exchange (IDX)

International Journal of Economics and Management Studies

© 2024 by SSRG - IJEMS Journal

Volume 11 Issue 7

Year of Publication : 2024

Authors : Sri Daryanti Zen, Elvira Luthan, Rahmi Hidayati

10.14445/23939125/IJEMS-V11I7P103

How to Cite?

Sri Daryanti Zen, Elvira Luthan, Rahmi Hidayati, "The Influence of Profitability, Liquidity, and Company Size on Debt Policy in Energy Sector Manufacturing Companies on the Indonesia Stock Exchange (IDX)," SSRG International Journal of Economics and Management Studies, vol. 11,  no. 7, pp. 19-25, 2024. Crossref, https://doi.org/10.14445/23939125/IJEMS-V11I7P103

Abstract:

The objective of this study is to assess the impact of profitability, liquidity, and firm size on the debt policy of mining entities that are publicly traded on the Indonesian Stock Exchange. Multiple prior studies on debt policy yield divergent findings. Hence, further investigation is required to reassess the hypothesis on debt policy. This study focuses on a population consisting of 53 mining enterprises. A purposive sampling strategy was employed to gather a sample of 49 entities for a period of 5 years (2018–2022), resulting in a total of 54 observations. The research data was acquired from the Indonesia Stock Exchange's Capital Market Directory. Multiple regression analysis is the methodology utilized for data analysis. The analysis found that profitability has a positive and significant impact on debt policy, whereas liquidity has a negligible impact. Additionally, business size has a significant and negative impact on debt policy.

Keywords:

Debt policy, Firm size, Indonesia stock exchange, Liquidity, Profitability, Debt policy.

References:

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