The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia

The main objective of this thesis is to examine the influence of company-specific on financial leverage of 88 industrial product companies listed in Bursa Malaysia. This study covers an observation period of 10 years (2005-2015) on panel data basis. Dynamic panel regression is applied as System Gene...

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Main Author:	Nurul Najwa, Roslee
Format:	Thesis
Language:	eng eng
Published:	2016
Subjects:	HJ Public Finance
Online Access:	https://etd.uum.edu.my/7496/1/s819821_01.pdf https://etd.uum.edu.my/7496/2/s819821_02.pdf
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id	my-uum-etd.7496
record_format	uketd_dc
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Ismail, Rusmawati
topic	HJ Public Finance
spellingShingle	HJ Public Finance Nurul Najwa, Roslee The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
description	The main objective of this thesis is to examine the influence of company-specific on financial leverage of 88 industrial product companies listed in Bursa Malaysia. This study covers an observation period of 10 years (2005-2015) on panel data basis. Dynamic panel regression is applied as System General Method of Moment (S-GMM) suggesting that the research model is genuinely dynamic. The results of the study indicates that all variables Age (SUSAgei,t), EPS Growth (SUSEPSgi,t), Total Asset (SIZETAi,t), Net Profit Margin (PRONPMi,t,), ROE (PROROEi,t), Quick Ratio (LIQRi,t,), Cash ratio (LICashRi,t) and Prior Leverage (LagLEVi,t-1) are significantly affecting the financial leverage (LEVi,t ). However, variables Age (SUSAgei,t), Total Asset (SIZETAi,t), Net Profit Margin (PRONPMi,t,), and Quick Ratio (LIQRi,t,) have a negative association with the leverage. Results of SUSEPSg, SIZETA, PRONPM, PROROE and LIQR support the pecking order theory while variables SUSAge, LICashR and LagLEVi,t-1 support the trade-off theory. General outcome of this study reveals that company specific factors are affecting leverage.
format	Thesis
qualification_name	other
qualification_level	Master's degree
author	Nurul Najwa, Roslee
author_facet	Nurul Najwa, Roslee
author_sort	Nurul Najwa, Roslee
title	The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
title_short	The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
title_full	The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
title_fullStr	The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
title_full_unstemmed	The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia
title_sort	effect of company-specific factors on financial leverage: evidence from industrial sector malaysia
granting_institution	Universiti Utara Malaysia
granting_department	School of Economics, Finance & Banking
publishDate	2016
url	https://etd.uum.edu.my/7496/1/s819821_01.pdf https://etd.uum.edu.my/7496/2/s819821_02.pdf
_version_	1747828228067688448
spelling	my-uum-etd.74962021-04-19T04:34:03Z The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia 2016 Nurul Najwa, Roslee Ismail, Rusmawati School of Economics, Finance & Banking School of Economics, Finance and Banking HJ Public Finance The main objective of this thesis is to examine the influence of company-specific on financial leverage of 88 industrial product companies listed in Bursa Malaysia. This study covers an observation period of 10 years (2005-2015) on panel data basis. Dynamic panel regression is applied as System General Method of Moment (S-GMM) suggesting that the research model is genuinely dynamic. The results of the study indicates that all variables Age (SUSAgei,t), EPS Growth (SUSEPSgi,t), Total Asset (SIZETAi,t), Net Profit Margin (PRONPMi,t,), ROE (PROROEi,t), Quick Ratio (LIQRi,t,), Cash ratio (LICashRi,t) and Prior Leverage (LagLEVi,t-1) are significantly affecting the financial leverage (LEVi,t ). However, variables Age (SUSAgei,t), Total Asset (SIZETAi,t), Net Profit Margin (PRONPMi,t,), and Quick Ratio (LIQRi,t,) have a negative association with the leverage. Results of SUSEPSg, SIZETA, PRONPM, PROROE and LIQR support the pecking order theory while variables SUSAge, LICashR and LagLEVi,t-1 support the trade-off theory. General outcome of this study reveals that company specific factors are affecting leverage. 2016 Thesis https://etd.uum.edu.my/7496/ https://etd.uum.edu.my/7496/1/s819821_01.pdf text eng public https://etd.uum.edu.my/7496/2/s819821_02.pdf text eng public other masters Universiti Utara Malaysia Abdeljawad, I., Nor, F. M., Ibrahim, I., & Abdul, R. (2013). Dynamic Capital Structure Trade-off Theory : Evidence from Malaysia. Proceedings of 3rd Global Accounting, Finance and Economics Conference, 9(6), 1–10. Adair, P., Adaskou, M., & McMillan, D. (2015). 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The effect of company-specific factors on financial leverage: Evidence from industrial sector Malaysia

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