Do Corporate Actions Have a Good Impact on Company’s Performance?
- DOI
- 10.2991/aebmr.k.211115.014How to use a DOI?
- Keywords
- Capital Structure; Financial Performance; IPO; Bonds
- Abstract
The company’s performance has always been the most important fundamental information as the basis for rational decision making by stakeholders. This study aims to examine the short and medium-term impacts of corporate action. The data selected as a sample are 10 companies listed in IDX from 2010 to 2016 that conducted Intial Public Offering (IPO) and issued bonds during the observation period. The research findings prove that the company’s goal of IPO and bond issuance is simply to avoid financial pressures that occur before and to obtain good valuation from investors. Furthermore, the issuance of bonds that are the first since the IPO has not had any impact on the company’s performance except the short-term impact only. However, the medium-term impact through the two corporate actions gave a very surprising result that despite obtaining extraordinary additional funds many turned out to be unable to improve profitability as well as the value of the company even sales performance decreased significantly. On the contrary, the corporate action is only aimed at improving the capital structure and working capital in order to keep the company operating before both corporate actions have deteriorated. This confirms the previous finding that the IPO company again used the source of funding in the form of hdebt for the company’s operations, paying dividends in ajeg, as well as manager expenditures in order to reduce agency problems.
- Copyright
- © 2021 The Authors. Published by Atlantis Press International B.V.
- Open Access
- This is an open access article under the CC BY-NC license.
Cite this article
TY - CONF AU - Yuli Soesetio AU - Dyah A Rudhiningtyas PY - 2021 DA - 2021/11/23 TI - Do Corporate Actions Have a Good Impact on Company’s Performance? BT - Proceedings of the BISTIC Business Innovation Sustainability and Technology International Conference (BISTIC 2021) PB - Atlantis Press SP - 102 EP - 109 SN - 2352-5428 UR - https://doi.org/10.2991/aebmr.k.211115.014 DO - 10.2991/aebmr.k.211115.014 ID - Soesetio2021 ER -