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Determinants of Corporate Cash Holdings in Pakistan

Author : Mohsin Shabbir

Publisher :

Page : 13 pages

File Size : 33,46 MB

Release : 2019

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ISBN :

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Book Description

Corporate cash holdings always involve a trade-off between benefits and costs. This study investigates the determinants of corporate cash holdings. Cash flows, leverage, liquidity, cash flows volatility, profitability, growth opportunities, firm size, debt maturity, and dividend represent the independent variables in the research study. It is based on a panel data of 150 Pakistani non-financial listed firms on KSE during the period 2004-2012. Panel regression analysis has been conducted to determine the major factors affecting cash holdings. The results imply that growth opportunity, company size, cash flows, and profitability of the firms exert a positive effect while leverage and liquidity show a significant negative impact on corporate cash holding. The findings indicated that both pecking order theory and trade-off theory play an important role in explaining the determinants of corporate cash holdings. The findings are beneficial for managers, shareholders, investors, regulatory bodies, and researchers for developing appropriate policies.



Determinants of Corporate Cash Holdings in Pakistan

Author : Mohsin Shabir

Publisher :

Page : 13 pages

File Size : 12,47 MB

Release : 2016

Category :

ISBN :

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Book Description

Corporate cash holdings always involve a trade-off between benefits and costs. This study investigates the determinants of corporate cash holdings. Cash flows, leverage, liquidity, cash flows volatility, profitability, growth opportunities, firm size, debt maturity, and dividend represent the independent variables in the research study. It is based on a panel data of 150 Pakistani non-financial listed firms on KSE during the period 2004-2012. Panel regression analysis has been conducted to determine the major factors affecting cash holdings. The results imply that growth opportunity, company size, cash flows, and profitability of the firms exert a positive effect while leverage and liquidity show a significant negative impact on corporate cash holding. The findings indicated that both pecking order theory and trade-off theory play an important role in explaining the determinants of corporate cash holdings. The findings are beneficial for managers, shareholders, investors, regulatory bodies, and researchers for developing appropriate policies.



Determinants of Corporate Cash Holdings

Author : Shaukat Ali

Publisher :

Page : 21 pages

File Size : 23,62 MB

Release : 2016

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ISBN :

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Book Description

The topic on cash holding has attracted strong debate in the field of financial management for the past half century. A number of researchers studied the topic corporate cash holding and its determinants in the past in developed economies while a little attention is given to the corporate cash holdings of developing economies. The objective of the study is to identify and measure the relationship of firm size, profitability, net working capital and leverage and their effect on corporate cash holdings. A sample of 30 textile firms of Pakistan listed on Karachi Stock Exchange (KSE) was selected for the study, for the reason of examining their relationship. Secondary data for the period 2006-2013 was selected for the study. Variance Inflation Test (VIF) was used to check the problem of multicollinearity. Multiple regression models were used to conduct the results. Results calculated by regression model show consistency with the literature available. Profitability (ROA) and firm size (FS) show a positive and significant relation with cash holding. However negative and significant relationship was found between net working capital (NWC) and leverage (LEV) with cash holding. The findings of the study may be useful for financial managers, financial management consultants and investors.



International Corporate Governance

Author : Kose John

Publisher : Emerald Group Publishing

Page : 210 pages

File Size : 44,5 MB

Release : 2011-03-31

Category : Business & Economics

ISBN : 0857249150

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Book Description

Presents research on corporate governance from a number of countries across the world, including the United States, Spain, Malaysia, Israel and others. This title examines many important corporate governance mechanisms, such as board characteristics, ownership structure, legal protection of shareholders, and annual general meetings.



Corporate Governance and Cash Holdings in Listed Non-Financial Firms of Pakistan

Author : Alina Masood

Publisher :

Page : 26 pages

File Size : 40,50 MB

Release : 2015

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Book Description

In this study, the relationship between corporate cash holdings and corporate governance variables is tested in Pakistan. The sample consists of 309 non-financial firms listed on the Karachi Stock Exchange (KSE) over the time span of 2002 to 2010. The study uses several proxies for corporate governance mechanisms such as percentage ownership held by directors, institutional investors, and five largest shareholders, the existence of audit committees and a measure of concentration of ownership. To avoid omitted variable bias, the study also controls for all well-known determinants of corporate cash holdings (market to-book ratio, growth, size, leverage, R&D investments, cash flow volatility and cash flows). The two main findings of the study are (i) director's ownership and board size are negatively related with corporate cash holdings. The institutional shareholdings, concentration of shares and the ownership percentage of 5 big shareholders are directly related to cash holdings. (ii) Among the control variables, growth and size are insignificant while dividend and cash flows are positively associated with cash holdings and leverage, capital expenditure and net-working capital are negatively related to cash holdings. The findings imply that managers of the firms do not misuse the cash when more monitoring and control is involved by the shareholders. The results also indicate that cash holdings by the firms are maintained for the dividend payments. Finally, debt and working capital act as a cash substitute for firms which lead to less cash holdings.



Global Business Strategies in Crisis

Author : Ümit Hacioğlu

Publisher : Springer

Page : 428 pages

File Size : 23,58 MB

Release : 2016-12-07

Category : Business & Economics

ISBN : 331944591X

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Book Description

As the world is currently in the midst of financial and economic crises, this collection of expert contributions focuses on strategy formation and implementation at various organizational levels to address the challenges ahead. The latest economic turmoil and its ongoing impact on business performance are compelling top managers to develop effective business strategies and redefine the boundaries of their operational and strategic activities. On one hand, tremendous challenges in the competitive business environment have become a source of global threats for many small entrepreneurs. On the other, investors faced with today’s volatile economic conditions demand more gains on their capital investments to counter-balance the growing risk of global threats. This book explores the question as to whether it is possible to efficiently and effectively address these threats and obstacles. Are managers capable of planning and implementing strategic actions? What should the major managerial strategy be in order to overcome fluctuations in a market-oriented society? The strategies and practices recommended here are aimed to design continuous development competencies and contribute to the stability, recovery and sustainability of global business operations under volatile economic conditions. This refreshingly novel book seeks to establish managerial strategies and practices for effectively responding to challenges in the competitive business environment, as global volatility and fluctuations continue to worsen.



Optimal Level, Partial Speed of Adjustment and Determinants of Corporate Cash Holding

Author : Abdessamad Raghibi

Publisher :

Page : 0 pages

File Size : 42,18 MB

Release : 2021

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ISBN :

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Book Description

This paper investigates the existence of an optimal cash level, speed of adjustment, and cash holdings determinants. The threshold regression and dynamic model were used in this study on four MENA countries from 2007 to 2018. The findings show there is a nonlinear relationship between cash level and firm's value which is consistent with the trade-off theory. Furthermore, our study confirms that firms holding cash above the optimal level of having a lower speed of adjustment than the firms with cash levels below the optimal level with size, growth, and net-working capital being key corporate cash determinants. Our results extend the theoretical implications of the trade-off theory to MENA countries and would help corporate policymakers to adjust their cash levels within the thresholds' levels to maximize their firm value.



Determinants of Corporate Investment Decision

Author : Ahmed Sheikh

Publisher :

Page : 23 pages

File Size : 38,33 MB

Release : 2020

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Book Description

This paper analyzed the trends in corporate finance in Pakistan and uses a panel data model for empirically identifying the factors which influence corporate investment decisions, during the period 2014-18. The findings revealed that firm-level factors such as cash flow, fixed capital intensity, leverage, and firm size are significant in determining corporate investment decisions. At the macro level, the cost of borrowing and the effective tax rate is significant in influencing corporate investment decisions negatively. The results of the study generally contribute to the existing literature on the impact of macroeconomic variables and certain firm-level factors on corporate investment decisions. The main value of this paper is to consider a broad-based approach to analyzing the determinants of corporate investment decisions from developing market context.





Internal Corporate Governance and Firm Cash Holdings in an Emerging Market

Author : Waheed Akhter

Publisher :

Page : pages

File Size : 38,95 MB

Release : 2019

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ISBN :

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Book Description

This paper investigates the link between corporate governance and cash holdings. We use a data set of firms listed on Pakistan Stock Exchange (PSX) and econometric techniques for panel data We show that institutional, family, and managerial ownership have negative impact on corporate cash holdings. Whereas, we find that foreign investors, top-five investors and block-holders have positive impact on corporate cash holdings. Our findings are consistent with agency problem hypothesis. Firms hoard large cash because of better control mechanisms and reduce the problem of free cash-flow. Large managerial ownership helps to align the interest of managers-shareholders. Finally, the firm-level financial factors including leverage, profitability, size, tangibility, payout ratio and liquidity have also significantly influence the cash ratio.Our study provides further insight into what determine corporate.