Pub Date : 2023-10-07DOI: 10.20525/ijfbs.v12i3.2890
None Rediyono
This research aims to see to how far extent the user interface and user experience an impact on consumer have purchasing decisions through E-Impulse Buying. The correspondents of this study were IKIP PGRI Samarinda students who were active in online purchases through the Shopee application with a usage time of 0-6 years and between 18-24 years of age. The total sample is 131 respondents using purposive sampling method. Research data comes from questionnaires distributed using Google Forms or Manually. The data analysis technique uses path analysis through the SPSS 22 program. The results found show that the user interface and user experience have an impact on purchasing decisions directly, the user interface has an impact on purchasing decisions through E-Impulse Buying, and User Experience has no Impact on decisions purchase through E-Impulse Buying.
{"title":"Indonesian Purchasing Decisions Through E-Impulse Buying","authors":"None Rediyono","doi":"10.20525/ijfbs.v12i3.2890","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i3.2890","url":null,"abstract":"This research aims to see to how far extent the user interface and user experience an impact on consumer have purchasing decisions through E-Impulse Buying. The correspondents of this study were IKIP PGRI Samarinda students who were active in online purchases through the Shopee application with a usage time of 0-6 years and between 18-24 years of age. The total sample is 131 respondents using purposive sampling method. Research data comes from questionnaires distributed using Google Forms or Manually. The data analysis technique uses path analysis through the SPSS 22 program. The results found show that the user interface and user experience have an impact on purchasing decisions directly, the user interface has an impact on purchasing decisions through E-Impulse Buying, and User Experience has no Impact on decisions purchase through E-Impulse Buying.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"70 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135252390","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-10-06DOI: 10.20525/ijfbs.v12i3.2851
Yacin Jerbi, Rania Bouzid
The aim of this paper is to evaluate barrier options by considering volatility as stochastic following the CIR process used in Heston (1993). To solve this problem, we used Monte Carlo simulation. We studied the effects of stochastic volatility on the value of the barrier option by considering different values of the determinants of the option. We illustrated these effects in twelve graphs. We found that in general, regardless of the parameter under study, the stochastic volatility model significantly overvalues the in-the-money (ITM) barrier options, and slightly the deep-in-the money (DIP) options, while slightly undervaluing the near-out-the money (NTM) options.
{"title":"Barrier options pricing under stochastic volatility using Monte Carlo simulation","authors":"Yacin Jerbi, Rania Bouzid","doi":"10.20525/ijfbs.v12i3.2851","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i3.2851","url":null,"abstract":"The aim of this paper is to evaluate barrier options by considering volatility as stochastic following the CIR process used in Heston (1993). To solve this problem, we used Monte Carlo simulation. We studied the effects of stochastic volatility on the value of the barrier option by considering different values of the determinants of the option. We illustrated these effects in twelve graphs. We found that in general, regardless of the parameter under study, the stochastic volatility model significantly overvalues the in-the-money (ITM) barrier options, and slightly the deep-in-the money (DIP) options, while slightly undervaluing the near-out-the money (NTM) options.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"48 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"134944592","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-23DOI: 10.20525/ijfbs.v12i3.2863
Alexey Brudno, Vladimir Arlazarov
In the modern world banks are unique. Formally, they are commercial enterprises, but in fact they have a government role, controlling all of the financial activity of the population and organizations. This article examines the roles of banks in the surveillance and pressuring of people that are not usually publicized. There is no political subtext in this article, as the situation described is typical for all countries. The fact that the majority of the examples given are from Russia and the USA simply reflects the experience of the authors. The other important thing to note is that the article describes the ongoing war of “banks against the people,” and the cascade of events is accelerating with nearly every month. And the winner in these intermittent skirmishes is always the same.
{"title":"The New Role of Banks in Modern Society","authors":"Alexey Brudno, Vladimir Arlazarov","doi":"10.20525/ijfbs.v12i3.2863","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i3.2863","url":null,"abstract":"In the modern world banks are unique. Formally, they are commercial enterprises, but in fact they have a government role, controlling all of the financial activity of the population and organizations. This article examines the roles of banks in the surveillance and pressuring of people that are not usually publicized. There is no political subtext in this article, as the situation described is typical for all countries. The fact that the majority of the examples given are from Russia and the USA simply reflects the experience of the authors. The other important thing to note is that the article describes the ongoing war of “banks against the people,” and the cascade of events is accelerating with nearly every month. And the winner in these intermittent skirmishes is always the same.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"6 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135966418","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This study aims to analyze the feasibility of investment in the framework of implementing cooperation in the utilization of assets or goods owned by the local government using descriptive semi-qualitative methods. In conducting the analysis, researchers used the investment feasibility approach is the Net Present Value (NPV) method to measure the present value of the expected net cash flow of a project, Internal Rate of Return (IRR) is the discount rate that makes the NPV of the project zero, Profitability Index (PI) to measure the relationship between the present value of net cash flow and initial investment and Payback Period (PP) is the period of time required to recover the initial investment from net cash flow. In addition, in order to develop tourism potential, researchers use the Segmenting Targeting Positioning (STP) strategy, which is an approach used by companies to understand their markets better and develop effective marketing strategies. The results prove that the cooperation plan for the utilization of assets or goods owned by the local government with partners as investors is feasible because it produces additional net cash flow during the project with a positive present value, and the rate of return on the net value of cash flow during the project is greater than the BI Rate and the benefits received from tourism development are more profitable than the costs incurred during the project. In addition, the time span required for payback is shorter than the project period. As an effort to increase tourism revenue and visitors, the Segmenting Targeting Positioning strategy is used.
{"title":"Investment Feasibility in the Framework of Implementation Cooperation in the Utilization of Regional Property","authors":"Lorasitaniajeng Sukamdani, Gaguk Apriyanto, Moh. Burhan","doi":"10.20525/ijfbs.v12i3.2866","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i3.2866","url":null,"abstract":"This study aims to analyze the feasibility of investment in the framework of implementing cooperation in the utilization of assets or goods owned by the local government using descriptive semi-qualitative methods. In conducting the analysis, researchers used the investment feasibility approach is the Net Present Value (NPV) method to measure the present value of the expected net cash flow of a project, Internal Rate of Return (IRR) is the discount rate that makes the NPV of the project zero, Profitability Index (PI) to measure the relationship between the present value of net cash flow and initial investment and Payback Period (PP) is the period of time required to recover the initial investment from net cash flow. In addition, in order to develop tourism potential, researchers use the Segmenting Targeting Positioning (STP) strategy, which is an approach used by companies to understand their markets better and develop effective marketing strategies. The results prove that the cooperation plan for the utilization of assets or goods owned by the local government with partners as investors is feasible because it produces additional net cash flow during the project with a positive present value, and the rate of return on the net value of cash flow during the project is greater than the BI Rate and the benefits received from tourism development are more profitable than the costs incurred during the project. In addition, the time span required for payback is shorter than the project period. As an effort to increase tourism revenue and visitors, the Segmenting Targeting Positioning strategy is used.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"22 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136130525","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-20DOI: 10.20525/ijfbs.v12i3.2843
Agus Sunandar, None Dwi Fitrizal Salim
Modern retail businesses in Indonesia are growing rapidly thanks to open market opportunities, manufacturing businesses that support product supply, and government support for economic growth through retail development. The purpose of this study is to determine the intrinsic value of shares of companies engaged in the food and staples retail sub-sector which in this case is represented by PT. Sumber Alfaria Trijaya, Tbk. (AMRT), PT. Diamond Food Indonesia, Tbk. (DMND), PT. Midi Utama Indonesia, Tbk. (MIDI), PT. Enseval Putera Megatrading, Tbk. (EPMT), and PT. Millenium Pharmacon Internatioanl, Tbk. (SDPC) listed on the Indonesia Stock Exchange (IDX). This research uses historical data for 2018-2022 which will be used as the basis for projections for 2023-2027. The results showed that by using the Discounted Cash Flow (DCF) method, specifically the Free Cash Flow to Firm (FCFF) approach, under an optimistic scenario, the intrinsic values of AMRT, SDPC, and DMND were undervalued. EPMT and MIDI stocks are overvalued. In the moderate scenario, the intrinsic values of AMRT, MIDI, EPMT, and DMND are overvalued, while SDPC is undervalued. Calculations on a pessimistic scenario, all companies studied are overvalued. In this study, the valuation of stocks was also conducted using the Relative Valuation (RV) method with the Price to Earnings Ratio (PER) and Price to Book Value (PBV) approaches. In an optimistic scenario, the stocks of AMRT, MIDI, and SDPC are considered expensive, while EPMT and DMND are seen cheap. In a moderat scenario, the stocks AMRT, EPMT, and SDPC are considered undervalued, while MIDI and DMND are seen expensive. In a pessimistic scenario, it is observed that AMRT, EPMT, and SDPC are undervalued, whereas MIDI and DMND are considered overvalued. This research aims to provide an objective assessment of the company, which investors can use to consider investments and by companies to enhance corporate value.
由于开放的市场机会、支持产品供应的制造企业以及政府通过零售发展对经济增长的支持，印度尼西亚的现代零售业正在迅速发展。本研究的目的是确定从事食品和主食零售子行业的公司股票的内在价值，在这种情况下，由PT. Sumber Alfaria Trijaya, Tbk代表。(AMRT)， PT. Diamond Food Indonesia, Tbk。(DMND)， PT. Midi Utama印度尼西亚，Tbk。(MIDI)， PT. Enseval Putera megtrading, Tbk。(EPMT)和PT. millennium Pharmacon international, Tbk。(SDPC)在印尼证券交易所(IDX)上市。本研究使用2018-2022年的历史数据，这些数据将作为2023-2027年预测的基础。结果表明，采用现金流折现法，即企业自由现金流法，在乐观情景下，AMRT、SDPC和DMND的内在价值被低估。EPMT和MIDI股票估值过高。在中等情景下，AMRT、MIDI、EPMT和DMND的内在价值被高估，而SDPC的内在价值被低估。在悲观的情况下，所有被研究的公司都被高估了。在本研究中，股票的估值也采用相对估值(RV)方法，采用市盈率(PER)和市净率(PBV)方法。在乐观的情况下，AMRT、MIDI和SDPC的股票被认为是昂贵的，而EPMT和DMND的股票被认为是便宜的。在适度的情况下，股票AMRT, EPMT和SDPC被认为被低估，而MIDI和DMND被认为是昂贵的。在悲观的情况下，可以观察到AMRT、EPMT和SDPC被低估，而MIDI和DMND被认为被高估。本研究旨在为公司提供一个客观的评估，投资者可以用它来考虑投资，并通过公司来提高公司价值。
{"title":"Comprehensive Analysis of Indonesian Retail Stocks Valuation in 2023","authors":"Agus Sunandar, None Dwi Fitrizal Salim","doi":"10.20525/ijfbs.v12i3.2843","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i3.2843","url":null,"abstract":"Modern retail businesses in Indonesia are growing rapidly thanks to open market opportunities, manufacturing businesses that support product supply, and government support for economic growth through retail development. The purpose of this study is to determine the intrinsic value of shares of companies engaged in the food and staples retail sub-sector which in this case is represented by PT. Sumber Alfaria Trijaya, Tbk. (AMRT), PT. Diamond Food Indonesia, Tbk. (DMND), PT. Midi Utama Indonesia, Tbk. (MIDI), PT. Enseval Putera Megatrading, Tbk. (EPMT), and PT. Millenium Pharmacon Internatioanl, Tbk. (SDPC) listed on the Indonesia Stock Exchange (IDX). This research uses historical data for 2018-2022 which will be used as the basis for projections for 2023-2027. The results showed that by using the Discounted Cash Flow (DCF) method, specifically the Free Cash Flow to Firm (FCFF) approach, under an optimistic scenario, the intrinsic values of AMRT, SDPC, and DMND were undervalued. EPMT and MIDI stocks are overvalued. In the moderate scenario, the intrinsic values of AMRT, MIDI, EPMT, and DMND are overvalued, while SDPC is undervalued. Calculations on a pessimistic scenario, all companies studied are overvalued. In this study, the valuation of stocks was also conducted using the Relative Valuation (RV) method with the Price to Earnings Ratio (PER) and Price to Book Value (PBV) approaches. In an optimistic scenario, the stocks of AMRT, MIDI, and SDPC are considered expensive, while EPMT and DMND are seen cheap. In a moderat scenario, the stocks AMRT, EPMT, and SDPC are considered undervalued, while MIDI and DMND are seen expensive. In a pessimistic scenario, it is observed that AMRT, EPMT, and SDPC are undervalued, whereas MIDI and DMND are considered overvalued. This research aims to provide an objective assessment of the company, which investors can use to consider investments and by companies to enhance corporate value.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"20 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136307307","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-18DOI: 10.20525/ijfbs.v12i2.2838
Arif Rachman, Dwi Fitrizal Salim
Many industrial sectors were severely affected during the pandemic, which lasted from 2020 to 2021. Such indicators can be observed in various companies implementing efficiency measures ranging from cost reduction unrelated to revenue growth to layoff policies. Despite being under pressure due to the pandemic, many industrial subsectors experienced significant growth in the second quarter of 2021, according to statistics from the Ministry of Industry. This study aims to determine the fair value of shares in Industrial Goods companies listed on the Indonesia Stock Exchange. This approach uses a discounted cash flow (DCF) methodology with free cash flow to the company and relative valuation through price-to-earnings and price-to-book ratios. From 2017 to 2021, historical financial data was utilized to forecast future income and expenditure behavior in three scenarios: optimistic, moderate, and pessimistic. The results showed that the DCF-FCFF technique underestimated IMPC, ARNA, and UNTR. MARK is overvalued in pessimistic, moderate, and optimistic scenarios, while MARK is undervalued in optimistic scenarios. HEXA is overvalued in the pessimistic scenario but undervalued in the moderate and optimistic scenario. ARNA and UNTR were overvalued in all relative assessment scenarios using the PER approach, but MARK and HEXA were undervalued. IMPC is undervalued in a gloomy scenario and overpriced in a moderate and optimistic scenario. In all cases, the PBV method overestimates IMPC, ARNA, MARK, HEXA, and UNTR. The study implies that investors should conduct thorough due diligence before making investment decisions, considering company-specific factors and broader market conditions. Companies in the Industrial Goods sector must be ready to adapt to changing market dynamics and prioritize long-term value creation to attract and maintain investor confidence.
{"title":"Fair Value Assessment for Industrial Goods Stocks in Indonesia Post-Pandemic","authors":"Arif Rachman, Dwi Fitrizal Salim","doi":"10.20525/ijfbs.v12i2.2838","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i2.2838","url":null,"abstract":"Many industrial sectors were severely affected during the pandemic, which lasted from 2020 to 2021. Such indicators can be observed in various companies implementing efficiency measures ranging from cost reduction unrelated to revenue growth to layoff policies. Despite being under pressure due to the pandemic, many industrial subsectors experienced significant growth in the second quarter of 2021, according to statistics from the Ministry of Industry. This study aims to determine the fair value of shares in Industrial Goods companies listed on the Indonesia Stock Exchange. This approach uses a discounted cash flow (DCF) methodology with free cash flow to the company and relative valuation through price-to-earnings and price-to-book ratios. From 2017 to 2021, historical financial data was utilized to forecast future income and expenditure behavior in three scenarios: optimistic, moderate, and pessimistic. The results showed that the DCF-FCFF technique underestimated IMPC, ARNA, and UNTR. MARK is overvalued in pessimistic, moderate, and optimistic scenarios, while MARK is undervalued in optimistic scenarios. HEXA is overvalued in the pessimistic scenario but undervalued in the moderate and optimistic scenario. ARNA and UNTR were overvalued in all relative assessment scenarios using the PER approach, but MARK and HEXA were undervalued. IMPC is undervalued in a gloomy scenario and overpriced in a moderate and optimistic scenario. In all cases, the PBV method overestimates IMPC, ARNA, MARK, HEXA, and UNTR. The study implies that investors should conduct thorough due diligence before making investment decisions, considering company-specific factors and broader market conditions. Companies in the Industrial Goods sector must be ready to adapt to changing market dynamics and prioritize long-term value creation to attract and maintain investor confidence.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"192 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135206101","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-13DOI: 10.20525/ijfbs.v12i2.2771
Surifah Surifah
This research aims to contribute to solving the problem of tax evasion, by examine the impact of shareholders, intellectual capital, auditor reputation, and level of liabilities on tax evasion. The population is taken from manufacturing companies operating in consumer goods from 2017 to 2021 at IDX (Indonesia). The sample was selected using purposive sampling method. The dependent variable of this research is tax evasion. The independent variables are: type of shareholders, intellectual capital, auditor reputation and level of liabilities. The data analysis technique uses multiple linear regression, and it is processed using statistical software. The results found that domestic private shareholder, foreign private, the government, and individuals’ share holder have a significant negative impact on the Earnings Tax Ratio (ETR), which is a proxy for tax evasion. This means that all types of shareholders seek to avoid taxes, even in state-owned enterprises. Tax avoidance in Indonesia is difficult to eradicate because it is carried out by various parties, specifically tax officers, tax consultants, and taxpayers. The discussion of this research is limited to various factors that influence tax evasion. Subsequent research can identify how much the state loses due to tax evasion, which is carried out by tax officers, consultants, or by taxpayers. This research found that all types of owners avoid taxes. This can be prevented if the Indonesian government can 1) enforce the law, 2) increase the trust of taxpayers, 3) avoid showing off the luxurious life of tax officials and their families. 4) uphold honesty and avoid corrupt behaviour.
{"title":"The Impact of Shareholders, Intellectual Capital, Auditor Reputation, and Liabilities Level on Tax Evasion in Indonesian Manufacturing Companies","authors":"Surifah Surifah","doi":"10.20525/ijfbs.v12i2.2771","DOIUrl":"https://doi.org/10.20525/ijfbs.v12i2.2771","url":null,"abstract":"This research aims to contribute to solving the problem of tax evasion, by examine the impact of shareholders, intellectual capital, auditor reputation, and level of liabilities on tax evasion. The population is taken from manufacturing companies operating in consumer goods from 2017 to 2021 at IDX (Indonesia). The sample was selected using purposive sampling method. The dependent variable of this research is tax evasion. The independent variables are: type of shareholders, intellectual capital, auditor reputation and level of liabilities. The data analysis technique uses multiple linear regression, and it is processed using statistical software. The results found that domestic private shareholder, foreign private, the government, and individuals’ share holder have a significant negative impact on the Earnings Tax Ratio (ETR), which is a proxy for tax evasion. This means that all types of shareholders seek to avoid taxes, even in state-owned enterprises. Tax avoidance in Indonesia is difficult to eradicate because it is carried out by various parties, specifically tax officers, tax consultants, and taxpayers. The discussion of this research is limited to various factors that influence tax evasion. Subsequent research can identify how much the state loses due to tax evasion, which is carried out by tax officers, consultants, or by taxpayers. This research found that all types of owners avoid taxes. This can be prevented if the Indonesian government can 1) enforce the law, 2) increase the trust of taxpayers, 3) avoid showing off the luxurious life of tax officials and their families. 4) uphold honesty and avoid corrupt behaviour.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"24 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135780799","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-02-01DOI: 10.20525/ijfbs.v11i4.2297
Anthony May
The fact that publicly traded companies incur substantial costs when issuing new equity has been extensively documented in the empirical finance literature. In particular, numerous studies show that seasoned equity offerings (SEOs) tend to be priced significantly below prevailing market prices, thereby causing issuers to leave money on the table. Offer price discounting is an indirect flotation cost borne by pre-SEO shareholders that, according to extant theoretical and empirical research, arises due to asymmetric information. A heretofore unrelated literature argues that corporate multinationalism, i.e., establishing operations in one or more foreign countries, exacerbates the asymmetric information problem via greater costs to shareholders of monitoring the activities and performance of foreign subsidiaries. Motivated by these lines of thought, I investigate the relation between SEO discounting and corporate multinationalism. Using a sample of SEOs completed by U.S. firms between 1998 and 2016, I show that offer price discounting is significantly higher in offerings conducted by multinational firms relative to those conducted by purely domestic firms after controlling for known determinants of SEO discounts. This effect is stronger for multinational firms with foreign subsidiaries spread across a greater number of countries and weaker for multinationals that hire a high-reputation underwriter to lead the underwriting syndicate. These findings suggest that asymmetric information costs borne by seasoned equity issuers are increasing in the geographic scope of a firm’s operations, which can be mitigated by certification from a highly reputed lead underwriter.
{"title":"Multinational Corporations and SEO Discounts","authors":"Anthony May","doi":"10.20525/ijfbs.v11i4.2297","DOIUrl":"https://doi.org/10.20525/ijfbs.v11i4.2297","url":null,"abstract":"The fact that publicly traded companies incur substantial costs when issuing new equity has been extensively documented in the empirical finance literature. In particular, numerous studies show that seasoned equity offerings (SEOs) tend to be priced significantly below prevailing market prices, thereby causing issuers to leave money on the table. Offer price discounting is an indirect flotation cost borne by pre-SEO shareholders that, according to extant theoretical and empirical research, arises due to asymmetric information. A heretofore unrelated literature argues that corporate multinationalism, i.e., establishing operations in one or more foreign countries, exacerbates the asymmetric information problem via greater costs to shareholders of monitoring the activities and performance of foreign subsidiaries. Motivated by these lines of thought, I investigate the relation between SEO discounting and corporate multinationalism. Using a sample of SEOs completed by U.S. firms between 1998 and 2016, I show that offer price discounting is significantly higher in offerings conducted by multinational firms relative to those conducted by purely domestic firms after controlling for known determinants of SEO discounts. This effect is stronger for multinational firms with foreign subsidiaries spread across a greater number of countries and weaker for multinationals that hire a high-reputation underwriter to lead the underwriting syndicate. These findings suggest that asymmetric information costs borne by seasoned equity issuers are increasing in the geographic scope of a firm’s operations, which can be mitigated by certification from a highly reputed lead underwriter.","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"56 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136172052","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"WOMEN ENTREPRENURS: FINANCING CHALLENGES DURING PANDEMIC","authors":"Isaura B. Flores, E. Muniz","doi":"10.18374/jifs-22-1.4","DOIUrl":"https://doi.org/10.18374/jifs-22-1.4","url":null,"abstract":"","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"130 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2022-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80136491","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Ahmed Elkassabgi, Kuldeep Singh, Aditya Limaye, D. Hunter
{"title":"INFORMATION PATHWAYS AND THEIR INFLUENCE ON CORRUPTION: AN EMPIRICAL STUDY","authors":"Ahmed Elkassabgi, Kuldeep Singh, Aditya Limaye, D. Hunter","doi":"10.18374/jifs-22-1.2","DOIUrl":"https://doi.org/10.18374/jifs-22-1.2","url":null,"abstract":"","PeriodicalId":30595,"journal":{"name":"International Journal of Finance Banking Studies","volume":"152 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2022-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77496781","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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