Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies

This study examines corporate cash holdings motives, the cross-sectional variations in their values, as well as their effect on investment opportunities. I use a sample of 315 Malaysian publicly listed firms from years 2005 to 2010 which include the period of pre, during and after World Financial cr...

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Main Author:	Mirzarakhmonovich, Bannapov Feruzbek
Format:	Thesis
Language:	eng eng
Published:	2011
Subjects:	HG Finance
Online Access:	https://etd.uum.edu.my/2686/1/Bannapov_Feruzbek_Mirzarakhmonovich.pdf https://etd.uum.edu.my/2686/2/1.Bannapov_Feruzbek_Mirzarakhmonovich.pdf
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id	my-uum-etd.2686
record_format	uketd_dc
spelling	my-uum-etd.26862016-04-19T02:30:06Z Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies 2011-02 Mirzarakhmonovich, Bannapov Feruzbek Ahmad, Norafifah College of Business (COB) College of Business HG Finance This study examines corporate cash holdings motives, the cross-sectional variations in their values, as well as their effect on investment opportunities. I use a sample of 315 Malaysian publicly listed firms from years 2005 to 2010 which include the period of pre, during and after World Financial crisis. I develop three competing hypotheses (transaction motive, agency motive, and tax motive), theory of financing hierarchy, investment opportunities and value of cash. Findings show that an additional ringgit held by Malaysian firms worth approximately between MYR0.90 and MYR0.93, indicating that shareholders believe that the benefits of companies holding cash outweigh the potential liquidity problems of agency cost associated with it. I also estimate marginal value of cash holdings of the firms by dividing them into three investment opportunity groups. I find that the marginal value of cash holding is MYR0.94 for firms with high investment opportunity, while it is MYR0.91 and MYR0.84 for firms with medium and low investment opportunity respectively. The findings are consistent with previous studies and support all the hypotheses tested. 2011-02 Thesis https://etd.uum.edu.my/2686/ https://etd.uum.edu.my/2686/1/Bannapov_Feruzbek_Mirzarakhmonovich.pdf application/pdf eng validuser https://etd.uum.edu.my/2686/2/1.Bannapov_Feruzbek_Mirzarakhmonovich.pdf application/pdf eng public masters masters Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Ahmad, Norafifah
topic	HG Finance
spellingShingle	HG Finance Mirzarakhmonovich, Bannapov Feruzbek Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
description	This study examines corporate cash holdings motives, the cross-sectional variations in their values, as well as their effect on investment opportunities. I use a sample of 315 Malaysian publicly listed firms from years 2005 to 2010 which include the period of pre, during and after World Financial crisis. I develop three competing hypotheses (transaction motive, agency motive, and tax motive), theory of financing hierarchy, investment opportunities and value of cash. Findings show that an additional ringgit held by Malaysian firms worth approximately between MYR0.90 and MYR0.93, indicating that shareholders believe that the benefits of companies holding cash outweigh the potential liquidity problems of agency cost associated with it. I also estimate marginal value of cash holdings of the firms by dividing them into three investment opportunity groups. I find that the marginal value of cash holding is MYR0.94 for firms with high investment opportunity, while it is MYR0.91 and MYR0.84 for firms with medium and low investment opportunity respectively. The findings are consistent with previous studies and support all the hypotheses tested.
format	Thesis
qualification_name	masters
qualification_level	Master's degree
author	Mirzarakhmonovich, Bannapov Feruzbek
author_facet	Mirzarakhmonovich, Bannapov Feruzbek
author_sort	Mirzarakhmonovich, Bannapov Feruzbek
title	Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
title_short	Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
title_full	Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
title_fullStr	Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
title_full_unstemmed	Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies
title_sort	value of cash holdings: an empirical evidence on malaysian publicly listed companies
granting_institution	Universiti Utara Malaysia
granting_department	College of Business (COB)
publishDate	2011
url	https://etd.uum.edu.my/2686/1/Bannapov_Feruzbek_Mirzarakhmonovich.pdf https://etd.uum.edu.my/2686/2/1.Bannapov_Feruzbek_Mirzarakhmonovich.pdf
_version_	1747827405027803136

Value of Cash Holdings: An Empirical Evidence on Malaysian Publicly Listed Companies

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