THE RELATIONSHIP BETWEEN ALTMAN Z-SCORE AND PRODUCTIVITY SCORE, MARKET CAPITALIZATION, CASH TO TOTAL ASSET, AND INDICATOR OF LOSS CASE OF PROPERTY AND REAL ESTATE SUB-SECTOR IN INDONESIA CAPITAL MARKET

• Main Author: Arira Putri, Rizkita
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/72380
• Institution: Institut Teknologi Bandung

Bankruptcy becomes one of the essential problems that might be faced by every companies including property and real estate companies in Indonesia. Currently, some economic and business analysts predict that Indonesia's property sector will have a better productivity in 2016. But, it does not guarantee that the companies will not be vulnerable with the bankruptcy. Bankruptcy is not always experienced by poor performance companies, but it can be also experienced by the good companies as well. Bankruptcy will adverse some negative effects and difficulties for the companies. Bankruptcy will also harm stakeholders such as employees, creditors, customers, and suppliers. That can be the reason why bankruptcy assessment is important. The purpose of this study is to examine the relationship between bankruptcy risk and productivity score, market capitalization, cash to total asset, and indicator of loss of the property and real estate industry in Indonesia. The study emphasizes on 36 property and real estate companies which listed in Indonesia Stock Exchange (IDX) during the period of 2009-2014. The first stage of data analysis will examine the bankruptcy risk based on Altman Bankruptcy Theory using five indicator ratios which measure liquidity, cumulative probability, profitability of companies, leverage, and revenue generating ability. The second stage will examine the productivity of firms using Data Envelopment Analysis (DEA) involving three inputs (cost of revenue, operating expense, and capital expenditure) and one output (revenue). The last stage will examine the relationship between bankruptcy risk of property and real estate industry in Indonesia and its productivity using the panel data regression method. The result of this study indicates that productivity does not have a significant relationship with bankruptcy risk. The study will contribute as an empirical analysis to highlight the link relationship between productivity and bankruptcy risk of property and real estate companies in Indonesia.