The Impact of Ownership Structure and Capital Structure on Financial Performance of Vietnamese Firms

Quang, Do Xuan; Xin, Wu Zhong

doi:10.5539/ibr.v7n2p64

Cited by 27 publications

(28 citation statements)

References 25 publications

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“…A high liability ratio could also encourage better external supervision with positive effects on profit. Quang and Xin (2014) conducted an empirical study on the impact of the capital structure on the financial performance of the nonfinancial firms listed in Vietnam between2009 and 2012. The results showed that capital structure has a statistically significant negative effect on financial performance measured by ROA and ROE.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Effect of Corporate Financial Leverage on Financial Performance: A Study on Publicly Traded Manufacturing Companies in Bangladesh

Dey¹,

Hossain²,

Rahman³

2018

ASS

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The study strives to examine the effect of financial leverage on financial performance in a developing country context using two OLS regression models based on panel data consisting of 816 cases (48 companies x 17 years). Financial performance is measured using ROA, ROE, EPS, and Tobin’s Q, and financial leverage is measured using the debt-assets ratio and debt-equity ratio. It is observed that ROA and Tobin’s Q are negatively correlated with financial leverage, which is in line with the assumptions of the pecking order theory, market timing theory, and many empirical studies. However, financial leverage has a positive effect on ROE and no effect on EPS. These results are also consistent with the MM theorem, static trade off theory and many other empirical studies. Yet again, the two OLS models have put forward conflicting results while taking EPS as the dependent variable. The results corroborate the inefficient use of debt capital and suggest the need to improve the reliability of accounting information.

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Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Effect of Corporate Financial Leverage on Financial Performance: A Study on Publicly Traded Manufacturing Companies in Bangladesh

Dey¹,

Hossain²,

Rahman³

2018

ASS

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“…Twairesh (2014) found leverage have significant impact on firm’s performance. Quang and Xin (2014) found capital structure has a negative impact with statistical significance on firm’s financial performance. Wang (2003) reveals a positive relationship between ownership structure and firm performance.…”

Section: Literature Reviewmentioning

confidence: 99%

Capital Structure and Firm Performance: Empirical Evidence from India

Chadha

Sharma

2015

Vision: The Journal of Business Perspective

119

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This paper studies the impact of capital structure or financial leverage on firm financial performance. A sample size of 422 listed Indian manufacturing companies on Bombay Stock Exchange (BSE) has been taken to analyze the relationship between leverage and firm performance. A period of 10 years from 2003–2004 to 2012–2013 and annual financial standalone data have been considered to analyze the leverage effect. Ratio analysis and panel data approach have been applied to perform the empirical study. Return on asset, return on equity and Tobin’s Q are used as the proxy for measuring the firm’s financial performance. It was found that financial leverage has no impact on the firm’s financial performance parameters of return on asset and Tobin’s Q. However, it is negative and significantly correlated with return on equity. Other independent variables like size, age, tangibility, sales growth, asset turnover and ownership structure are significant determinants of a firm’s financial performance in the Indian manufacturing sector. Thus, the findings of the study would enhance the literature on capital structure and is relevant for the Indian manufacturing industry in taking its capital structure decisions as it is based on the most recent data and covers the period of both pre- and post-recession of 2008–2009. There is an adverse effect of recession on the financial performance of the Indian manufacturing firms.

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“…Also, the sampling technique was using probability sampling method with the saturated sampling technique. (Akeem et al, 2014;Chandra, 2015;Fauzi et al, 2013;Khan et al, 2013;Mirza & Javed, 2013;Quang & Xin, 2014) 7 Profitability = 100% Ratio (Chadha & Sharma, 2015;Ghi & Ba, 2015;Quang & Xin, 2014) 8…”

Section: Methodsmentioning

confidence: 99%

“…It can be inferred that the companies with the ability to produce more profit prefer using funding from the company's internal sources beside using funding from the company's external sources (loan). A study by (Quang & Xin, 2014) found that capital structure negatively influenced company's profitability. It is in line with the studies by (Akeem et al, 2014;Chadha & Sharma, 2015;Chen & Chen, 2011;Salim & Yadav, 2012).…”

Section: Capital Structurementioning

confidence: 99%

Capital Structure Determinant and Profitability and Their Impact on Firm Value: Study in Indonesian Manufacturing Sector

Wijaya¹,

Budiyanto²,

Asyik³

2021

IJEF

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Indonesian manufacturing sector becomes an important key for encouraging the national economy. This study aimed to analyze the correlation of capital structure and profitability with firm value by using tangible assets and intangible assets. The population was 145 companies in the manufacturing sector. The sampling technique was purposive sampling that collected a sample of 94 companies during 2010-2019. Data analysis technique was path analysis assisted by SPSS. The result of structural model I stated that firm size, volatility, and uniqueness significantly influenced capital structure, while tangibility insignificantly influenced capital structure. The result of structural model II stated that intellectual capital and capital structure significantly influenced profitability. Further, the result of structural model III stated that capital structure and profitability significantly influenced firm value. The indirect effect test found that profitability could mediate influence between capital structure and firm value.

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The Impact of Ownership Structure and Capital Structure on Financial Performance of Vietnamese Firms

Cited by 27 publications

References 25 publications

Effect of Corporate Financial Leverage on Financial Performance: A Study on Publicly Traded Manufacturing Companies in Bangladesh

Effect of Corporate Financial Leverage on Financial Performance: A Study on Publicly Traded Manufacturing Companies in Bangladesh

Capital Structure and Firm Performance: Empirical Evidence from India

Capital Structure Determinant and Profitability and Their Impact on Firm Value: Study in Indonesian Manufacturing Sector

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