THE IMPACT OF SELECTED FINANCIAL RATIOS ON THE MARKET PERFORMANCE OF LISTED COMPANIES ON THE ACCELERATION BOARD INDONESIA STOCK EXCHANGE (PERIOD 2020-2023)

• Main Author: Puspita, Inaya
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/85888
• Institution: Institut Teknologi Bandung

Small and medium sized companies (SMEs) are critical to Indonesia's economy. According to data from the Republic of Indonesia's Ministry of Cooperatives and SMEs, as cited by OECD iLibrary (2022), SMEs numbered 64.2 million and accounted for 99.99% of all firms and 96.9% of all workers in 2019. To support the growth of SMEs, In 2019, the Indonesia Stock Exchange (IDX) published Listing Regulation number I-V Concerning Specific Provisions for the Listing of Shares and Equity Type Securities on the Acceleration Board Issued by the Listed Company. The IDX Regulation number I-V allows for certain flexibility in public offerings by small and medium-sized asset businesses when compared to the general listing criteria on the Main Board and Development Board under Rule I-A. One of the leniencies is that IDX Listing Regulation number I-V contains no financial constraints. However, regrettably, 85% of the 40 companies listed on the Acceleration Board between 2020 and 2023 have seen their stock prices fall since the IPO. As a result, the purpose of this research was to determine the impact of selected financial parameters such as ROA, ROE, DER, NPM, and Cash Flow from Operations on market performance as measured by the stock price. A multiple regression model in SPSS is used in this research to test the correlation of selected financial ratios and market performance of the listed companies on the Acceleration Board. The data analysis results show that the dependent variables that consist of ROA, ROE, DER, NPM, and Cash Flow from Operations simultaneously can explain variation change of stock price about 25,6%, while the rest of 74,4% can be explained by other variables. The results of hypothesis testing show only NPM has a significant impact on the stock price. From the research result, there are some recommendations for IDX as one of the capital market regulators in Indonesia. IDX should consider revising the listing regulations number I-V by adding financial requirements for the small and medium assets company, especially the financial requirement related to net income. This revision planning also needs to involve all parties in the Indonesia Capital Market ecosystem.