The Role of Dividend Policy in the Relational Economic Parameters Determining Company Value in Manufacturing Companies on The Idx

Abstract

The number of food and beverage sub-sector companies on the IDX increased from 35 to 95 between 2019 and 2023. The increase in the number of companies is not matched by an increase in company value (PBV), where PBV in 2019 - 2023 decreased (PBV value 4.3 to 1.5). The purpose of this study is to analyze the effect of financial ratios on the value of food and beverage sub-sector companies on the IDX in 2019-2023. The object of this study is manufacturing companies in the food and beverage sub-sector on the IDX. The financial ratios used are: liquidity, leverage, profitability, and dividend policy. The analysis method uses a quantitative approach with PLS data analysis techniques and the research sample is 12 companies using purposive sampling. The results of the study: partially Current Ratio and Debt to Equity Ratio do not affect company value and Dividend Payout Ratio cannot moderate the effect of Current Ratio and Debt to Equity Ratio on company value. Return on Assets partially affects company value and Dividend Payout Ratio can moderate the effect of Return on Assets on company value. Implications : company management should pay more attention to the financial ratios of liquidity, leverage, and profitability used to measure company value. For investors, this can be a consideration in making investment decisions by looking at the company's value (PBV). A PBV of less than 1 indicates a relatively low stock price, and a PBV of more than 1 indicates a relatively high stock price.

Keywords: Financial Ratios, Firm Value