Profitability boosts, liquidity hinders: Indonesian companies' capital structure secrets revealed!
The study looked at how a company's profits, assets, and cash flow affect how it borrows money. They studied 38 companies in Indonesia from 2015 to 2018. They found that higher profits tend to lead to more borrowing, while having more cash on hand tends to lead to less borrowing. The type of assets a company has didn't seem to have a big impact on how much it borrows.