Proceedings of the 7th Regional Accounting Conference (KRA 2020)

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The Announcement of an Increase in Cigarette Excise Rates and Its Implication Towards Indonesia Capital Market

Authors
Martin Hansel, Tabita Prajogo, Tarsisius Suganda
Corresponding Author
Martin Hansel
Available Online 19 April 2021.
DOI
10.2991/aebmr.k.210416.004How to use a DOI?
Keywords
Increase in cigarette excise rates, abnormal return, event study, trading volume activity
Abstract

Purpose of this research is to investigate the reaction of Indonesia capital market to the announcement of an increase in cigarette excise rates on September 13th 2019. The cigarette sub sector companies that has been listed on the Indonesia Stock Exchange are used as sample. Event study is a research approach to investigate the reaction of the Indonesia capital market towards the announcement of increasing cigarette excise rates. In this study, market adjusted model was chosen to explain the expected return from the announcement of an increase in cigarette excise rates. Nine days of windows period were used which consist of four days before the announcement, announcement date, and four days after the announcement of the increase in cigarette excise rates. There were two proxies that have been aksed to explain capital market namely abnormal return, and trading volume activity. The finding of the result showed that the market reacted to the announcement which was found from the abnormal return at t-4 and t+3. On the other hand, there was no significant reaction towards the announcement proxied by trading volume activity.

Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 7th Regional Accounting Conference (KRA 2020)
Series
Advances in Economics, Business and Management Research
Publication Date
19 April 2021
ISBN
978-94-6239-366-0
ISSN
2352-5428
DOI
10.2991/aebmr.k.210416.004How to use a DOI?
Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

risenwbib
TY  - CONF
AU  - Martin Hansel
AU  - Tabita Prajogo
AU  - Tarsisius Suganda
PY  - 2021
DA  - 2021/04/19
TI  - The Announcement of an Increase in Cigarette Excise Rates and Its Implication Towards Indonesia Capital Market
BT  - Proceedings of the 7th Regional Accounting Conference (KRA 2020)
PB  - Atlantis Press
SP  - 25
EP  - 31
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.210416.004
DO  - 10.2991/aebmr.k.210416.004
ID  - Hansel2021
ER  -