Analysis of the Influence of Capital Structure on Corporate Values

: High firm value creation is the duty of a company's financial managers. The firm value need to be reviewed any factors that influence it. Therefore, this study aimed to determine the influence of capital structure towards the corporate value. The study conducted on a sub-sector of restaurants, hotels, and tourism along with the development of tourism industry in Indonesia. In this study, the data used in the form of secondary data taken from the company's financial statements last 7 years, the year of 2012-2018. The data used for capital structure is the ratio of total debt to total assets (debt to assets ratio/ DAR) and the corporate value using the ratio of the stock market price to book value (price to book value/ PBV). Both ratios arranged in the form of pool data (time series and cross-section). Descriptive and verification analyze by EViews version 9, a specialized software for pool data processing. The results from the research found that the capital structure influential positively and significantly to the firm value. The influence magnitude of the capital structure to the corporate value amounted to 72% in favor of Modigliani & Miller’s Capital Structure theory and in line with the results of Hermuningsih’s research about the influence of profitability, growth opportunity, and capital structure toward the corporate value at public companies in Indonesia.