How microeconomic factors influence Vietnam’s listed manufacturing firm value

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It is meaningful to identify and quantify the impact of business microeconomic factors on firm value, not only for enterprises, but also for the industry, which contributes to the economic growth of the whole country. This paper aims to find evidence of how microeconomic factors relate to the value of manufacturing firms, helping businesses behave and adjust towards the goal of value maximization. This study applies three commonly used estimators with panel data, namely OLS, FEM and REM, using data obtained from FiinPro (a data providing company) and Vietstock on 691 companies listed on Vietnam’s two stock exchanges from 2008 to 2015; This was a sensitive period of world financial crisis, and Vietnamese manufacturing firms had a really hard time to overcome the difficulty in a global economy downturn. This paper found that (1) firm size, growth opportunities and financial leverage negatively affect firm value; (2) there is no evidence that operating cash flow, cash liquidity and intellectual capital affect firm value; (3) the estimation results confirm the non-linear relationship (order 3) between the directors’ share ownership ratio and corporate value; (4) state ownership and foreign ownership ratios have a negative effect on Vietnamese listed manufacturing firms during the period, but (5) there is no optimal number of BOD members. The findings help to measure the extent of the positive and negative impact of various factors, making it easier to find solutions to improve business value by promoting positive factors and preventing negative factors.

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    • Figure 1. Relationship between NED and Tobin’s Q
    • Figure 2. Relationship between OWNCEO and Tobin’s Q
    • Table 1. Hypotheses and references
    • Table 2. Industry structure of the sample
    • Table 3. Statistic description
    • Table 4. Correlation matrix
    • Table A1. Impact of factors on Tobin’s Q: Pooled OLS model
    • Table A2. The impact of factors on Tobin’s Q: REM model
    • Table A3. The impact of factors on Tobin’s Q: Fixed effects model
    • Table A4. Impact of factors on Tobin’s Q: Elements of VAIC
    • Table A5. Impact of factors on Tobin’s Q in each sector
    • Conceptualization
      Phuong Lan Le
    • Data curation
      Phuong Lan Le
    • Formal Analysis
      Phuong Lan Le
    • Funding acquisition
      Phuong Lan Le
    • Investigation
      Phuong Lan Le
    • Methodology
      Phuong Lan Le
    • Project administration
      Phuong Lan Le
    • Resources
      Phuong Lan Le
    • Software
      Phuong Lan Le
    • Supervision
      Phuong Lan Le
    • Validation
      Phuong Lan Le
    • Visualization
      Phuong Lan Le
    • Writing – original draft
      Phuong Lan Le
    • Writing – review & editing
      Phuong Lan Le
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Investment Management and Financial Innovations