Estimating of Debt Financing, Equity Financing Towards Profit Expense in Indonesia

Hadya, Rizka

doi:10.22202/economica.2021.v10.i1.4965

Cited by 1 publication

(1 citation statement)

References 12 publications

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“…This approach involves securing financial resources through loans obtained from banks, financial institutions, or individual lenders, with a formal commitment to repay the borrowed principal amount along with interest within a predetermined timeframe. Utilizing debt offers tax advantages since the interest expenses incurred can lead to a reduction in taxable income [10]. A startup or venture firm necessitates substantial financial resources at various junctures, including early-stage research and development, mass production and market expansion during the growth phase, and market positioning in the maturity phase [11].…”

Section: Business Issuementioning

confidence: 99%

Funding Valuation to Support Disaggregation of Value Chain in HLMC Hospital Yogyakarta

Irawan,

Damayanti,

Noveria

2023

ijcsrr

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The economic cycle always goes through boom-and-bust cycles. When the economy slows down, the government will increase the money circulation; when the economy is heating up, the government will slow down the money circulation. In this regard, interest rates, credit control, currency policies, and so on play a role. The COVID-19 pandemic era accelerated the economic cycle relatively quickly. During the pandemic, the government provided massive stimuli to the economy, and during the recovery phase, the government tightened financial policies again. Such actions have made the global investment market experience tumultuous twists and turns. Corporate funding, which was relatively easier before, has become difficult. Companies once again have to adjust their business models to their original goals: value creation, generating profit and margin, and ultimately producing positive cash flow. Adapting to the changing demands of the business environment, shifting from a “growth at all costs” mindset to prioritizing “more sustainable profit,” companies must acknowledge that the essence of business activities is to generate real cash flow and tangible profits. This study compares different approaches to valuing companies: the Discounted Cash Flow (DCF), Revenue Multiple, and PE Multiples. DCF takes a valuation approach based on projections of the company’s future cash flows and real profits operationally, whereas revenue and PE multiples offer simpler valuation methods by emphasizing relative comparisons within similar industries. This simplification aids investors in evaluating potential profits when executing exit strategies. Therefore, the valuation method using DCF (Discounted Cash Flow) is not as aggressive as the valuation method using exit multiples, such as P/E (Price/Earnings) Multiple, let alone Revenue Multiple. This research serves as a benchmark for the funding valuation method to support the disaggregation outlined by HLMC Hospital Yogyakarta in the field of skin, aesthetic, and wellness centers.

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Section: Business Issuementioning

confidence: 99%