The Effects of The Assets and Capital Structures on Firm Value: The Mediating Role of Financial Performance, An Evidence in Healthcare Providers on Indonesia Stock Exchange (IDX) from 2017 to 2021

Yudi, Idham Sapta and Sembel, Roy and Malau, Melinda (2023) The Effects of The Assets and Capital Structures on Firm Value: The Mediating Role of Financial Performance, An Evidence in Healthcare Providers on Indonesia Stock Exchange (IDX) from 2017 to 2021. South East Asia Journal of Contemporary Business, Economics and Law, 29 (1). pp. 30-44. ISSN 2289-1560

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Abstract

This study is initial research on the healthcare provider (hospital companies) on IDX Health - F121 that analyze the effect of assets structure, capital structure and financial performance on the firm value of hospital companies in 2017-2021 and discusses lower NPM and ROE. The research method used is explanatory with a quantitative approach. The sampling technique used is purposive sampling with a total population of 10 hospital companies. Retrieval of company secondary data through IDX, the company's official website, Yahoo Finance and IDN Financial. The SmartPLS application is used in this research to analyze regression data, perform classical assumption tests and hypotheses tests. This research analyzed the effect and correlation among those variables and identified factors and problems that explain why the hospital companies have lower performances, invest in large capital, have large equity, and are still dependent on the government budget. Based on the research results, it was indicated that assets structure has significant effects on financial performance and firm value. An increase in asset utility contributed to generating revenue, however, fixed asset utilization tends to decrease as capital expenditure shifts from infrastructure to a technology base. Revenue is supported by covid-19 patients during the pandemic in 2020 - 2021 is covered by the government budget. Hospital companies tend to use internal capital rather than debt and become more conservative in their operating finance and investment financing. Their conservatism in finance is proven by Pecking Order Theory, and in Trade Off Theory, their tendency to use internal capital will have an effect on the lower ROE. Besides that, investors expect high returns and look for a higher NPM and ROE. Keywords: Capital Structure, Assets Structure, Financial Performance, Firm Value, Net Profit Margin.

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