The impact of profitability on firm value was always been a matter of great interest for financial managers, because the objective of a company is to increase its value and on the other hand the investors expect higher returns on their investment. Therefore, the purpose of present research is to investigate the impact of profitability on firm value moderated with capital structure in different Saudi Arabian companies. The profitability is measured in terms of ROA (Return on Assets) and ROE (Return on Equity), firm value is calculated using Tobin's Q. Capital structure is measured with the debt-equity ratio. The study selects different companies listed on Tadawul as a sample and the study period starts in 2013 and ends in 2020. To analyze the data collected from the annual reports of listed companies, the study reports results by employing panel regression with FE and RE model, and panel GMM. The analyzed results report a positively significant impact of profitability on firm value and a negative and significant effect of capital structure on firm value in all the estimated models. Further, the capital structure interacts as a moderator between profitability and firm value, where the study finds a negatively significant effect of profitability on firm value after moderation. The results strengthen the moderation of capital structure between profitability and firm value.
The outbreak of COVID-19 affected all aspects of individuals at a worldwide level. It harmed the physically and economically of individuals, and lower the growth of economies, globally. India the third largest consumer of oil and gas was affected by the pandemic, negatively. The study is based on the data collected from the financial statements of Indian oil and gas companies available on the websites. The purpose of the study is to know the financial performance of the Indian oil and gas companies pre and post-COVID-19 pandemic period. The absolute and relational financial variables are applied to get the absolute trend and relational growth of the financial performance of Indian oil and gas companies in graphical form. To explore the profit-earning capacity, short-term paying ability, and long-term paying ability of the Indian oil and gas companies, profitability (profit before tax ratio) ratio, liquidity (current ratio) ratio, and solvency (Debt-Equity ratio) ratio were applied. From 2015 to 2021, the absolute values of revenues, total expenses, and profit before tax were applied to get the trend in graphical form while stacked column charts were prepared to compare the profitability, liquidity, and long-term paying ability of the Indian oil and gas companies. During the pandemic period, total revenues, total expenses, profits, and profitability declined while liquidity and solvency status was unaffected by COVID-19 in Indian oil and gas companies. The profitability of the smaller Indian oil and gas companies improved more than the larger Indian oil and gas companies after the COVID-19 pandemic. It is found that the large-scale production of Indian oil and gas companies was affected more than the smallerscale production of Indian and gas companies by the negativity of the pandemic COVID-19 due to fixed expenses.
The amount of profitability, liquidity, solvency, and resource utilization are used to evaluate a corporate organization's financial performance. The firm's size is determined by revenue, overall resources, and the availability of capital to execute the business operations. The study tries to get the governance of the financial performance by the size of firms in the Indian oil and gas sector. The study is based on secondary data taken from the website of Indian oil and gas companies. ANOVA, stacked column chart, and Tukey’s homogeneity analysis applied for to get the disparity, variations and growth trend, and homogeneity of relative financial measures of financial performance. In Indian oil and gas firms, profitability is governed by the size of the firms negatively and directly while return on resources is negatively but negligibly by the size of the firms. There is no governance of liquidity and solvency by the size of firms in the Indian oil and gas industry. The larger manufacturing Indian oil and gas companies must increase their managerial and cost effectiveness in order to increase their profitability and absolute profits, while the smaller production Indian oil and gas companies must include debt in order to increase their level of activity and absolute profits.
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