International Journal of Science and Research (IJSR)

International Journal of Science and Research (IJSR)
Since Year 2012 | Open Access | Fully Refereed | Peer Reviewed

ISSN: 2319-7064




Downloads: 125

Case Studies | Business Management | Indonesia | Volume 7 Issue 6, June 2018


The Influence of Working Capital and Solvability on Profitability and Firm's Value in the Infrastructure, Utilities and Transportation Sector

Ditta Prissylia | Lukytawati Anggraeni [5] | Hendro Sasongko [9]


Abstract: The research is conducted to know working capital and solvability to profitability and firms value. The objects used are 21 companies of infrastructure, utility and transportation sectors of Indonesia Stock Exchange in 2010-2016. The hypothesis in this study is using panel data regression. The study aims to explore the effects of working capital and solvabilitas component i. e cash conversion cycles (CCC), current asset to total asset ratio (CATAR), current liabilities to total asset ratio (CLTAR), and degree of financial leverage (DFL) to the firms performance by looking at firms value i. e Tobins Q (TQ) and profitability i. e. net operating profit (NOP). The results shows that CCC has a positive influence on the profitability of the company sector, but having a negative influence on the firms market value. DFL has a positive influence on profitability and firm value. Companies with high CCC scores require higher external financing. Therefore, the importance of managing working capital needs to ensure an increase in the firms value and profitability of the company and strategic thinking in the operational aspects of the company to operate efficiently and effectively.


Keywords: Working capital, Solvability, Profitability, and Tobins Q


Edition: Volume 7 Issue 6, June 2018,


Pages: 1521 - 1526

The Influence of Working Capital and Solvability on Profitability and Firm's Value in the Infrastructure, Utilities and Transportation Sector


How to Cite this Article?

Ditta Prissylia, Lukytawati Anggraeni, Hendro Sasongko, "The Influence of Working Capital and Solvability on Profitability and Firm's Value in the Infrastructure, Utilities and Transportation Sector", International Journal of Science and Research (IJSR), https://www.ijsr.net/get_abstract.php?paper_id=ART20182113, Volume 7 Issue 6, June 2018, 1521 - 1526, #ijsrnet

How to Share this Article?

Enter Your Email Address




Similar Articles with Keyword 'Working capital'

Downloads: 117

Research Paper, Business Management, India, Volume 6 Issue 3, March 2017

Pages: 1619 - 1629

The Impact of Environmental Factors on the Performance of Micro & Small-Scale Enterprises in East Gojjam Zone, Ethiopia

Mulugeta Kebede | Getaendale Simesh

Share this Article

Downloads: 120

Research Paper, Business Management, Kenya, Volume 7 Issue 5, May 2018

Pages: 1551 - 1555

Influence of Inventory Control Techniques on Service Delivery in Parastatals in Kenya: A Case Study of Kenya Medical Supplies Authority

Benjamin Mwangangi Mumo | Anaya W. Senelwa

Share this Article


Top