Determinants of capital structure in Sharia criteria manufacturing firms on the Indonesia Stock Exchange

Abstract

Theories and results of research on the determinants of a firm's capital structure provide different explanations and evidence. Sharia criteria companies on the Indonesia Stock Exchange (IDX) are not allowed to have a ratio of total interest-based debt to total assets of more than 45%, which predicted have an impact on the determinants of their capital structure. This research was conducted at Sharia criteria manufacturing companies on the Indonesia Stock Exchange in 2011-2017. The results of the analysis showed that only profitability had the same direction that is negative on the two capital structure measures, book leverage and market leverage. Growth opportunity and firm size have different effects on the two capital structure measures, which are a positive effect on book leverage and negative on market leverage. Tangibility, business risk, and inflation only affect market leverage. Tangibility and inflation have a positive effect on market leverage, while business risk has a negative effect. This study found no evidence that gross domestic product (GDP) affects leverage, both on book leverage and market leverage. AbstrakTeori dan hasil-hasil penelitian tentang faktor-faktor penentu struktur modal perusahaan memberikan penjelasan dan bukti-bukti yang berbeda. Perusahaan-perusahaan kriteria syariah di Bursa Efek Indonesia (BEI) tidak diperkenankan memiliki rasio total utang berbasis bunga terhadap total aset lebih dari 45%, yang diprediksi akan berdampak terhadap determinan struktur modal mereka. Penelitian ini dilakukan pada perusahaan-perusahaan manufaktur kriteria syariah di BEI tahun 2011-2017. Hasil analisis menunjukkan bahwa hanya profitability yang memiliki pengaruh dengan arah yang sama yaitu negatif terhadap kedua ukuran struktur modal, yaitu book leverage dan market leverage. Growth opportunity dan ukuran perusahaan memiliki pengaruh yang berbeda terhadap kedua ukuran struktur modal, yaitu berpengaruh positif terhadap book leverage dan negatif terhadap market leverage. Tangibility, risiko bisnis, dan inflasi hanya berpengaruh terhadap market leverage. Tangibility dan inflasi berpengaruh positif terhadap market leverage, sedangkan risiko bisnis berpengaruh negatif. Penelitian ini tidak menemukan bukti bahwa gross domestic product (GDP) berpengaruh terhadap leverage, baik terhadap book leverage maupun market leverage. How toCite: Mai, M. U. (2019). Determinants of capital structure in Sharia criteria manufacturing firms on the Indonesia Stock Exchange. Jurnal Keuangan dan Perbankan, 23(3), 418-429. https://doi.

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