Determinants of capital structure in Nigeria’s quoted consumer goods firms

Nurudeen Yisau; Adesoji Oke; Modinat Odukoya

doi:10.55026/jobaf.1400273

EN

Determinants of capital structure in Nigeria’s quoted consumer goods firms

Abstract

Although the factors that influence capital structure have been the subject of numerous prior studies, the topic of what determines the best financing combination to maximize a firm's value is still one of the most contentious in corporate finance. Furthermore, a large number of earlier research paid little attention to emerging countries and instead concentrated mostly on developed markets. To fill the gap, this study examined the factors that influence capital structure decisions in quoted Nigerian consumer goods companies that are publicly traded. The study used secondary data from the annual reports of 15 of the mentioned corporations, spanning ten years from 2011 to 2020. The association between the leverage ratio and the five explanatory variables in the model was investigated using the Panel Least Square regression approach. The study's findings showed that while growth is not statistically significant, firm size, non-debt tax shield, and firm growth all positively and significantly affect leverage. Furthermore, tangibility and profitability are negative and have a large impact on leverage. Based on the study's findings, it can be said that the capital structure of listed consumer products companies in Nigeria is significantly influenced by factors such as size, non-debt tax shield, profitability, and tangibility. The study then suggested that financial managers of listed firms in Nigeria should deploy effective measures to boost these important variables to have an optimum financing mix for their firms.

Keywords

Debt financing , Tangibility , Profitability , Non-debt Tax shields , leverage ratio

Kaynakça

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Ayrıntılar

Birincil Dil

İngilizce

Konular

Finansal Kurumlar

Bölüm

Araştırma Makalesi

Yazarlar

Nurudeen Yisau ^*
0000-0002-4131-6621
Nigeria

Adesoji Oke Bu kişi benim
0000-0002-5558-7481
Nigeria

Modinat Odukoya Bu kişi benim
0009-0003-3088-6607
Nigeria

Yayımlanma Tarihi

15 Ocak 2024

Gönderilme Tarihi

6 Aralık 2023

Kabul Tarihi

12 Ocak 2024

Yayımlandığı Sayı

Yıl 2024 Cilt: 11 Sayı: 1

DOI

https://doi.org/10.55026/jobaf.1400273

IZ

https://izlik.org/JA99WR85BF

APA

Yisau, N., Oke, A., & Odukoya, M. (2024). Determinants of capital structure in Nigeria’s quoted consumer goods firms. Bankacılık ve Finansal Araştırmalar Dergisi, 11(1), 19-44. https://doi.org/10.55026/jobaf.1400273

Cited By

The influence of non-debt tax shields on the interest coverage ratio: evidence from S&P 500 companies

Journal of Financial Reporting and Accounting

https://doi.org/10.1108/JFRA-05-2025-0432

Determinants of capital structure in Nigeria’s quoted consumer goods firms

Determinants of capital structure in Nigeria’s quoted consumer goods firms

Abstract

Keywords

Öz

Kaynakça

Ayrıntılar

Birincil Dil

Konular

Bölüm

Yazarlar

Yayımlanma Tarihi

Gönderilme Tarihi

Kabul Tarihi

Yayımlandığı Sayı

DOI

IZ

Kaynak Göster

Cited By

The influence of non-debt tax shields on the interest coverage ratio: evidence from S&P 500 companies