IDEAS home Printed from https://ideas.repec.org/a/bcp/journl/v9y2025issue-3p4188-4201.html
   My bibliography  Save this article

Exploring the Effect of Capital Structure on Firm Value in Information and Communication Technology Listed on the Nigeria Exchange Group (Ngx)

Author

Listed:
  • Afolabi, Chukwudi Segun

    (Department, Business Edication, Osun State collge of Education, Ila-orangun, Nigeria.)

  • Ogunleye, Joshua Kehinde

    (Department of Accounting, University of Ilesa, Ilesa, Nigeria.)

  • Akinleye, Bilikis Olayem

    (Department of Accounting, Adeleke University Ede, Nigeria.)

  • Odetayo, Tajudeen Adewale

    (Department of Accounting, University of Ilesa, Ilesa, Nigeria.)

  • Oladeji, Felicia Oluremi

    (Department of Accounting, University of Ilesa, Ilesa, Nigeria.)

Abstract

This study examined the effect of total debt to assets equity, total debt to assets, long-term debt to assets, and short-term debt to assets on the valuation of publicly listed Information and Communication Technology (ICT) firms in Nigeria from 2014 to 2023. Size was utilized as a moderating variable. The study population comprises seven (7) information and communication technology firms. The sample selection was conducted utilizing the census sampling method. As a result, we collected all seven samples. Secondary data was obtained from the annual reports of the selected companies, and panel data analysis was conducted using fixed effects, random effects, and pooled ordinary least squares methods. Hausman’s Chi-square statistics were employed to analyze the data. The research analyzed three categories of debt: total debt, long-term debt, and short-term debt. Each of the three factors demonstrated a positive impact on the company’s value, with statistical values of t = 2.6102 (P

Suggested Citation

  • Afolabi, Chukwudi Segun & Ogunleye, Joshua Kehinde & Akinleye, Bilikis Olayem & Odetayo, Tajudeen Adewale & Oladeji, Felicia Oluremi, 2025. "Exploring the Effect of Capital Structure on Firm Value in Information and Communication Technology Listed on the Nigeria Exchange Group (Ngx)," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(3), pages 4188-4201, March.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-3:p:4188-4201
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijriss/Digital-Library/volume-9-issue-3/4188-4201.pdf
    Download Restriction: no
    File URL: https://rsisinternational.org/journals/ijriss/articles/exploring-the-effect-of-capital-structure-on-firm-value-in-information-and-communication-technology-listed-on-the-nigeria-exchange-group-ngx/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gillan, Stuart L. & Koch, Andrew & Starks, Laura T., 2021. "Firms and social responsibility: A review of ESG and CSR research in corporate finance," Journal of Corporate Finance, Elsevier, vol. 66(C).
    2. Citra Larasati & Abdul Rivai & Suharto, 2020. "Effect of Debt to Equity Ratio and Return on Assets on Earnings per Share with Firm Value as a Moderating Variable in Various Industrial Sub-Sector Manufacturing Companies Indonesia," Asian Business Research Journal, Eastern Centre of Science and Education, vol. 5, pages 39-47.
    3. Iddrisu Suhaibu & Abdulai Abdul‐Malik, 2021. "Debt policy, firm value, and the macroeconomic environment nexus: Evidence from non‐financial sector firms in Ghana," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 2106-2117, April.
    4. Myers, Stewart C. & Majluf, Nicholas S., 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Journal of Financial Economics, Elsevier, vol. 13(2), pages 187-221, June.
    5. Kun Tracy Wang & Greg Shailer, 2018. "Does Ownership Identity Matter? A Meta‐analysis of Research on Firm Financial Performance in Relation to Government versus Private Ownership," Abacus, Accounting Foundation, University of Sydney, vol. 54(1), pages 1-35, March.
    6. Rafiuddin Ahmed & Rafiqul Bhuyan, 2020. "Capital Structure and Firm Performance in Australian Service Sector Firms: A Panel Data Analysis," JRFM, MDPI, vol. 13(9), pages 1-16, September.
    7. Razali Haron, 2018. "Firm Level, Ownership Concentration and Industry Level Determinants of Capital Structure in an Emerging Market: Indonesia Evidence," Asian Academy of Management Journal of Accounting and Finance (AAMJAF), Penerbit Universiti Sains Malaysia, vol. 14(1), pages 127-151.
    8. Chaudhary, Ghulam Mujtaba & Iqbal, Zafar & Hussain, Nazakat, 2023. "Financial Leverage, Distress, and Firms Performance: Global and Local Perspective," Sustainable Business and Society in Emerging Economies, CSRC Publishing, Center for Sustainability Research and Consultancy Pakistan, vol. 5(3), pages 205-214, September.
    9. Petros Kalantonis & Christos Kallandranis & Marios Sotiropoulos, 2021. "Leverage and firm performance: new evidence on the role of economic sentiment using accounting information," Journal of Capital Markets Studies, Emerald Group Publishing Limited, vol. 5(1), pages 96-107, February.
    10. Feras Izzat Kasasbeh, 2021. "Impact of financing decisions ratios on firm accounting-based performance: evidence from Jordan listed companies," Future Business Journal, Springer, vol. 7(1), pages 1-10, December.
    11. Thi Ngoc Bui & Xuan Hung Nguyen & Kieu Trang Pham, 2023. "The Effect of Capital Structure on Firm Value: A Study of Companies Listed on the Vietnamese Stock Market," IJFS, MDPI, vol. 11(3), pages 1-20, August.
    12. Obumneme Renato Anozie & Taiwo Adewale Muritala & Victor Edet Ininm & Nurudeen Salako Yisau, 2023. "Impact of capital structure on financial performance of oil and gas firms in Nigeria," Future Business Journal, Springer, vol. 9(1), pages 1-9, December.
    13. Jaroslav Mazanec, 2023. "Capital Structure and Corporate Performance: An Empirical Analysis from Central Europe," Mathematics, MDPI, vol. 11(9), pages 1-19, April.
    14. Ganiyu, Olumuyiwa & Adelopo, Ismail & Rodionova, Yulia & Samuel, Olawale Luqmon, 2019. "Capital Structure and Firm Performance in Nigeria," African Journal of Economic Review, African Journal of Economic Review, vol. 7(01), January.
    15. María Consuelo Pucheta-Martínez & Isabel Gallego-Álvarez, 2020. "Do board characteristics drive firm performance? An international perspective," Review of Managerial Science, Springer, vol. 14(6), pages 1251-1297, December.
    16. Tesfa Nega Tesema, 2024. "The effect of capital structure on performance: empirical evidence from manufacturing companies in Ethiopia," Cogent Economics & Finance, Taylor & Francis Journals, vol. 12(1), pages 2300926-230, December.
    17. Riaqa Mubeen & Dongping Han & Jaffar Abbas & Iftikhar Hussain, 2020. "The Effects of Market Competition, Capital Structure, and CEO Duality on Firm Performance: A Mediation Analysis by Incorporating the GMM Model Technique," Sustainability, MDPI, vol. 12(8), pages 1-18, April.
    18. Ploypailin Kijkasiwat & Anwar Hussain & Amna Mumtaz, 2022. "Corporate Governance, Firm Performance and Financial Leverage across Developed and Emerging Economies," Risks, MDPI, vol. 10(10), pages 1-20, September.
    19. Andrey Kulikov & Naief Alabed Alkader & Galina Panaedova & Aleksandr Ogorodnikov & Evgenii Rebeka, 2023. "Modelling Optimal Capital Structure in Gas and Oil Sector by Applying Simulation Theory and Programming Language of Python (Qatar Gas Transport Company)," Energies, MDPI, vol. 16(10), pages 1-15, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nouf Alabdulkarim & Lakshmi Kalyanaraman & Hanan Alhussayen, 2024. "The impact of firm size on the relationship between leverage and firm performance: evidence from Saudi Arabia," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    2. Omole Ilesanmi Isaac & Adewumi Ayodeji, 2024. "Capital Structure, Board Characteristics and Firm Performance of Listed Non-Financial Companies," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(1), pages 1776-1789, January.
    3. Helmi Boshnak, 2023. "The impact of capital structure on firm performance: evidence from Saudi-listed firms," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 20(1), pages 15-26, March.
    4. Mohammad Safari & Zahra Kazemi Saraskanrood, 2023. "Drivers of the Target Financial Leverage and Speed of Adjustment in Small and Medium-Sized Companies at Different Stages of Life Cycle," European Journal of Studies in Management and Business, EUROKD, vol. 25, pages 16-31.
    5. Bilyay-Erdogan, Seda & Danisman, Gamze Ozturk & Demir, Ender, 2024. "ESG performance and investment efficiency: The impact of information asymmetry," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 91(C).
    6. Fafaliou, Irene & Giaka, Maria & Konstantios, Dimitrios & Polemis, Michael, 2022. "Firms’ ESG reputational risk and market longevity: A firm-level analysis for the United States," Journal of Business Research, Elsevier, vol. 149(C), pages 161-177.
    7. Chen, Lifeng & Khurram, Muhammad Usman & Gao, Yuying & Abedin, Mohammad Zoynul & Lucey, Brian, 2023. "ESG disclosure and technological innovation capabilities of the Chinese listed companies," Research in International Business and Finance, Elsevier, vol. 65(C).
    8. Oli Ahad Thakur & Bany‐Ariffin Amin Noordin & Bolaji Tunde Matemilola & Md. Kausar Alam & Doddy Setiawan, 2022. "Impact of goodwill on capital structure and the moderating role of investors' education," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(7), pages 2657-2677, October.
    9. Nyoman Triaryati & Ubud Salim & Risna Wijayanti & Andarwati, 2025. "Risk Disclosure and Debt Policy as Value Determinants of Small and Mid-Cap Firms," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 45-62.
    10. Shoaib Khan & Tahir Akhtar & Ameen Qasem, 2024. "Dynamics of capital structure determinants: empirical evidence from GCC countries," Future Business Journal, Springer, vol. 10(1), pages 1-18, December.
    11. Allen, Franklin & Barbalau, Adelina, 2024. "Security design: A review," Journal of Financial Intermediation, Elsevier, vol. 60(C).
    12. Ahmed Samour & Abdullah AlGhazali & Mihaela Gadoiu & Mariana Banuta, 2024. "Capital structure and financial performance of China’s energy industry: What can we infer from COVID-19?," PLOS ONE, Public Library of Science, vol. 19(6), pages 1-14, June.
    13. Cosma, Simona & Galletta, Simona & Mazzù, Sebastiano & Rimo, Giuseppe, 2024. "Banks' fossil fuel divestment and corporate governance: The role of board gender diversity," Energy Economics, Elsevier, vol. 139(C).
    14. Barka, Zeineb & Hamza, Taher & Mrad, Senda, 2023. "Corporate ESG scores and equity market misvaluation: Toward ethical investor behavior," Economic Modelling, Elsevier, vol. 127(C).
    15. Ariefianto, Moch. Doddy & Trinugroho, Irwan & Yustika, Ahmad Erani & Soedarmono, Wahyoe, 2020. "The Role of Business Sophistication, Revenue Diversification, and Labor Relations on Firm Financing Choice," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 54(3), pages 101-115.
    16. Zifeng Feng & Zhonghua Wu, 2023. "ESG Disclosure, REIT Debt Financing and Firm Value," The Journal of Real Estate Finance and Economics, Springer, vol. 67(3), pages 388-422, October.
    17. Zhang, Dongna & Zhao, Zuoxiang & Lau, Chi Keung Marco, 2022. "Sovereign ESG and corporate investment: New insights from the United Kingdom," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    18. Wen, Huwei & Liu, Yupeng & Lee, Chien-Chiang, 2024. "How ESG performance affects maturity mismatches between investment and financing: Evidence from Chinese A-share listed companies," Research in International Business and Finance, Elsevier, vol. 71(C).
    19. Seid Muhammed & Goshu Desalegn & Prihoda Emese, 2024. "Effect of Capital Structure on the Financial Performance of Ethiopian Commercial Banks," Risks, MDPI, vol. 12(4), pages 1-15, April.
    20. Ibrahim Yousef & Hanada Almoumani & Ihssan Samara, 2020. "The Impact of Internationalization of the Boardroom on Capital Structure," JRFM, MDPI, vol. 13(12), pages 1-15, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcp:journl:v:9:y:2025:issue-3:p:4188-4201. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Pawan Verma (email available below). General contact details of provider: https://rsisinternational.org/journals/ijriss/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.