Examining the Determinants of Firm Value in Indonesia's Consumer Cyclicals Sector: Panel Data Evidence 2018–2022

Objective: This study examines whether profitability (Return on Assets, ROA), leverage (Debt to Equity Ratio, DER), liquidity (Current Ratio, CR), and the market ratio (Earning per Share, EPS) are associated with firm value, measured by Price to Book Value (PBV), in consumer cyclicals companies listed on the Indonesia Stock Exchange (IDX) during 2018–2022. Research Design & Methods: The study uses a quantitative, associative design with observational panel data: 35 companies selected by purposive sampling, giving a balanced panel of 175 firm-year observations. Chow, Hausman, and Lagrange Multiplier tests selected the Random Effect Model, which was estimated in EViews 10 and accompanied by classical assumption tests. Findings: ROA (p = 0.0001) and DER (p = 0.0039) are positively and significantly associated with PBV, whereas CR (p = 0.1708) and EPS (p = 0.8283) are not. The four ratios are jointly significant (F-test p < 0.001; Adjusted R-square = 0.6888). The results are statistical associations, not causal effects. Contributions: Earlier evidence on the ratios associated with firm value in Indonesia is mixed and comes mostly from manufacturing, property, and index-based samples. This study adds sector-specific evidence for consumer cyclicals, a sector exposed to the COVID-19 demand shock and its recovery. In this sample, ROA and DER were the only two of the four ratios significantly associated with PBV; investors and managers may consider them alongside other information. Novelty: The study does not propose a new model. It provides a jointly estimated, specification-tested panel model for one sector over a period spanning pre-pandemic, pandemic, and recovery years. It does not formally test differences across sectors or periods, which is left for future research.