Bandung, West Java—The Effect of
Financial Distress and Intellectual Capital on Company Value with Company Size
as a Moderation Variable in the Tourism and Recreation Industry. This research
was conducted by Dhea Handayani and Rosmini Ramli from Jenderal Achmad Yani
University (Unjani) which will be published in the East Asian Journal of
Multidisciplinary Research (EAJMR) in 2026.
Research conducted by Dhea
Handayani and Rosmini Ramli revealed that financial distress is the main factor
that reduces the value of companies in the tourism and recreation sector in
Indonesia. Meanwhile, intellectual capital has not been proven to significantly
affect market valuation in the post-pandemic recovery period of 2020–2024.
Financial
Distress Becomes a Negative Signal for Investors
Using data from
10 tourism and leisure companies listed on the Indonesia Stock Exchange during
2020–2024 (200 quarterly observations), this study measures the value of
companies with Tobin's Q, financial pressure with the Springate (S-Score)
model, and intellectual capital using the VIC method. The results of the panel
regression analysis showed that financial distress had a significant negative
effect on the company's value, with a probability value of 0.0074 (below 0.05).
This means that the higher the financial pressure, the lower the value of the
company in the eyes of investors.
Financial
pressure is considered a signal of bankruptcy risk and uncertainty of business
continuity. Tourism companies that have high fixed costs—such as facility
maintenance, labor, and destination operations—become particularly vulnerable
when cash flows are unstable. Statistically, the research model was declared
significant with an F value of 4.0766 and a probability of 0.0184. However, the
two main variables only explain about 3.97 percent variation in company value,
suggesting that many other factors outside the model also influence market
valuations.
Intellectual
Capital Is Not Yet the Main Consideration
In contrast to
many previous studies, this study found that intellectual capital has no
significant effect on the value of a company. The probability value reaches
0.3786, well above the significance threshold.
These findings
suggest that during the recovery period, investors focus more on real financial
performance such as cash flow and ability to pay liabilities rather than on
human resource management, innovation, or organizational systems.
Tourism
companies that rely heavily on physical assets and direct services are judged
more by operational stability than the strength of knowledge-based assets.
Large
Companies Are More Vulnerable to Market Reactions
This study also
examines the role of company size as a moderation variable. The results show
that the size of the company actually strengthens the negative impact of
financial distress on the company's value. The coefficient of financial
distress interaction and company size is significant with a probability of
0.0000. This means that when a large company experiences financial pressure,
the decline in value is sharper than that of a small company.
This happens
because large companies have higher public exposure, larger assets and debt,
and are in the spotlight of investors. When financial problems arise, the
market responds faster and harder. On the contrary, the size of the company
actually weakens the influence of intellectual capital on the value of the
company. The coefficient of interaction between intellectual capital and
company size was significantly negative (probability 0.0185). This shows that
in large companies, physical assets and financial stability are more dominant
than intellectual capital management.
Implications
for Industries and Investors
This research
provides a strategic message for tourism and leisure industry players:
- Financial management should be a top priority,
especially in maintaining liquidity and controlling debt.
- Large companies need to be more vigilant because
financial pressures have a greater impact on market valuations.
- The development of intellectual capital remains
important, but it must be accompanied by an improvement in financial
performance in order to be recognized by the market.
- Investors need to consider indicators of financial
health and company size before making investment decisions in the sector.
These findings
also confirm that the recovery of the tourism sector on a macro scale does not
necessarily reflect a recovery in corporate performance on a micro basis.
Author
Profile
•
Dhea Handayani –Jenderal Achmad Yani
University (Unjani).
•
Rosmini Ramli –Jenderal Achmad Yani
University (Unjani).
Research
Source
Handayani, D., &
Ramli, R. (2026). The Influence of Financial Distress and Intellectual Capital
on Company Value with Company Size as a Moderating Variable in the Tourism and
Recreation Industry.
East Asian Journal
of Multidisciplinary Research (EAJMR), Vol. 5 No. 2, pp. 663–680.
DOI: https://doi.org/10.55927/eajmr.v5i2.15
Official URL : https://journaleajmr.my.id/index.php/eajmr
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