Erik Syawal Alghifari, Atang Hermawan, Ardi Gunardi, Agus Rahayu, Lili Adi Wibowo
This paper focuses on strategic corporate financial decisions related to capital structure to increased firm value, moderated by the COVID-19 pandemic under MM theory, trade-off theory, and pecking order theory. The analytical method used is panel data analysis, with observations of 1828 non-financial companies on the Indonesia Stock Exchange from the years 2019 to 2021. The results show that there is an effect of capital structure on firm value in a positive direction, and the moderating role of the COVID-19 pandemic weakens the effect of capital structure on firm value. The findings show that capital structure only has a significant effect on firm value for the debt-dominant group, but not for the equity-dominant group. The moderating effect of the COVID-19 pandemic affects firm value for the debt-dominant group, but not for the equity-dominant group. © 2022 by the authors.
Department of Management, Universitas Pendidikan Indonesia, Bandung, 40154, Indonesia; Faculty of Economics and Business, Universitas Pasundan, Bandung, 40116, Indonesia
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