Financial performance impacts capital structure in Indonesia, shaping firms' success.
The study aimed to understand how different factors affect a company's financial performance and debt levels in Indonesia. The researchers analyzed financial data from Indonesian firms and found that profitability can impact debt levels positively or negatively. Factors like market value and tangible assets don't seem to affect debt levels, while larger firms tend to have lower debt. Managerial ownership can decrease debt, while institutional ownership can increase it. Lower sales growth can lead to higher debt levels. Overall, a company's financial performance can influence its debt levels.