THE IMPACT OF THE RUSSIA-UKRAINE CONFLICT ON PROFITABILITY, VALUATION AND MARKET EFFICIENCY OF INDONESIAN COAL STOCKS

• Main Author: Sihab Budin Firmansyah, Irfan
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/79620
• Institution: Institut Teknologi Bandung

This thesis investigates the impact of the 2022 Russian invasion of Ukraine on the profitability, valuation, and market efficiency of publicly listed Indonesian coal companies. Leveraging panel regression and event study methodologies, the study offers empirically grounded perspectives on how an acute geopolitical conflict disrupted global energy trade flows to influence key financial metrics of a major exported commodity. Specifically, the analysis focuses on five leading Indonesian coal miners over 20192022. Profitability dynamics are examined through gross profit margins while valuations reliance on price-to-earnings ratios. Market efficiency is tested around the onset of the invasion. Control variables capture coal prices, a conflict indicator, inflation, interest rates, and exchange rate fluctuations. Results reveal the global coal price spike had a statistically significant positive impact on profit margins, affirming the turmoil's commodity super-cycle upside. However, valuations diverged from earnings trends, suggesting more complex reassessments of long-term prospects. The conflict itself directly affected profitability but not valuations. Meanwhile, the market demonstrated informational efficiency despite volatility upon the acute shock. This thesis contributes timely empirical insights on an understudied intersection of geopolitics, commodity markets, and emerging market equities. Evidence-based quantification of financial linkages and risk transmission inform both theory and practice. Strategic decision makers obtain granular clarity regarding exposures and opportunities during energy market turmoil.