The efficiency of leverage, liquidity, and profitability on the corporate performance of selected manufacturing companies

V. Sadhishkumar and P. Uma Swarupa

International Journal of Indian Culture and Business Management, 2024, vol. 33, issue 1, 1-21

Abstract: The paper attempts to evaluate the impact of leverage, liquidity, and profitability on the corporate performance of the selected manufacturing companies listed on the Indian stock exchange for the past five years from 2017 to 2021. In this case, ROA, ROE is selected as the dependent variable for the performance. The data is it here is taken with a sample size of 500. Along with that, 20 manufacturing companies were chosen. In independent variables, the debt-to-equity ratio, EPS, has been chosen. Apart from that, the forms' liquidity, age, and tangibility are taken as control variables. The empirical outcomes of the investigation manifest that liquidity computed by the current assets has a positive impact on the return on equity applied as performance. The study highlights that the impact of financial leverage has a huge effect on corporate performance. The study further suggests the administration reduce the application of debt financing and apply their retained earnings mostly for financing the day-to-day operations and to ignore any kind of bankruptcy in the future.

Keywords: efficiency of leverage; liquidity; profitability; corporate performance; manufacturing companies; empirical outcomes; tangibility of the forms. (search for similar items in EconPapers)
Date: 2024
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