Impact of Company Characteristics on Leverage of the Textile and Garment Sector in the Indonesia Stock Exchange

Abstract

A company in running its business is always directed at predetermined goals, including maximizing profitability for the welfare of shareholders and company owners. Many factors can affect the profitability of a company. This study aims to analyze the effect of the variables Profitability, Firm Size, Asset Growth and Liquidity on the Leverage of Textile and Garment companies. The objects used in this study are all Textile and Garment companies listed on the Indonesia Stock Exchange with a total of 17 companies starting from 2018 to 2021. The sampling technique used is purposive sampling, namely by taking 14 companies as a sample of the 17 existing companies based on criteria which is determined. The analysis technique used is multiple linear regression. Based on the results of hypothesis testing that the Profitability variable contributes to increasing Leverage in Textile and Garment Companies, Firm Size does not contribute to increasing Leverage in Textile and Garment Companies, Asset Growth contributes to increasing Leverage in Textile and Garment Companies, Liquidity contributes to increasing Leverage at the Textile and Garment Company.