FINANCIAL PERFORMANCE ANALYSIS OF INDONESIAN LISTED TOBACCO COMPANY REGARDING THE GRAPHIC HEALTH WARNING REGULATION

• Main Author: Diane Savitri (19015193), Garisya
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/27459
• Institution: Institut Teknologi Bandung

Indonesia is one of the countries in the world that has a high smoking rates. Tobacco <br /> <br /> Industry describes Indonesia as a country with favorable growth market. But, the high smoking <br /> <br /> rates in Indonesia is being a concern due to the negative impact towards the general health of the <br /> <br /> society. The high number of consumption of cigarette is due to the lack of regulation by the <br /> <br /> Government towards Tobacco. In 2012 the government are issuing the Tobacco Control <br /> <br /> Regulation PP No. 109 year 2012 which imply a stricter rules on distribution and marketing of <br /> <br /> cigarettes including the Graphic Health Warning in Article 14, 15, and 17. The government gives <br /> <br /> for the company 18 months to comply with this regulation after the regulation was signed, or by <br /> <br /> June 24th, 2014. <br /> <br /> This research aims to obtain empirical evidence about the differential in the financial <br /> <br /> performance of Listed Tobacco Companies in Indonesia before and after the Graphic Health <br /> <br /> Warning regulation. This research will analyze the short term effect of the regulation towards the <br /> <br /> financial performance of the company. This research used Altman Z-Score approach with 2 years <br /> <br /> of event window period, consisting 1 year before and after the regulation was issued. The research <br /> <br /> sample are Altman Z-Score of the Listed Tobacco Companies in Indonesia which are HM <br /> <br /> Sampoerna (HMSP), Gudang Garam (GGRM), Bentoel Internasional Investama (BII) during <br /> <br /> period 2013-2015. The author use difference-in-difference method as well as Wilcoxon Signed- <br /> <br /> Rank test for robustness to observe the short term effect of Graphic Health Warning regulation <br /> <br /> towards the financial performance of the Listed Tobacco Companies in Indonesia.