The Influence of Intra-group Financing, Capital Structure and Debt Servicing Coverage on the Economic Value Added of Companies in the Real Estate Sector Listed on the Stock Exchange of Thailand
Keywords:
Intra-group Financing, Capital Structure, Debt Servicing Coverage, Economic Value-Added Spread, Property DdevelopmentAbstract
This study aimed to analyze the relationship and influence of equity dependence on the group's capital structure, and debt repayment capability on the economic value added of real estate companies listed on the Stock Exchange of Thailand. Quarterly retrospective data were collected from 21 companies, from the first quarter of 2020 to the fourth quarter of 2024. The panel data was used, with a total of 420 records. Descriptive statistics were used for analysis, including minimum, maximum, mean, and standard deviation. The Panel Least Squares (PLS) technique was also used, using the EViews software package.
The results revealed that equity dependence on the group's capital in the form of loans from related
parties (LFRP), interest coverage ratio (ICR), and firm size (SIZE) were significantly correlated with EVA spread, indicating that companies that effectively utilize equity utilization from related parties tend to create higher value. Furthermore, companies with larger sizes and strong interest coverage have an advantage in value creation. Debt-to-equity ratio (DE) was significantly inversely related to EVA spread, indicating that high debt leverage reduces firm value. Furthermore, loans to related parties were not correlated with EVA spread. These findings can serve as guidelines for the real estate sector. Financing and managing financial structure are key factors affecting the company's ability to create sustainable added value, especially in the context of listed companies. Financial decisions not only reflect operating results but also impact on long-term enterprise value.
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