The heavy construction and civil engineering subsector on the Indonesia Stock Exchange demonstrates that market value added plays a crucial role in determining investor returns, whereas the price-earnings ratio alone does not show a statistically significant partial effect. This study was conducted by Septiana Putri Vianida and Ratna Dumilah from Universitas Pamulang. The research examines historical data from the 2020–2024 period to understand the fundamental factors influencing stock returns amid the dynamics of national infrastructure development.
The construction industry holds a strategic role in the national economy, contributing significantly to Indonesia's Gross Domestic Product (GDP). Nevertheless, stock returns in the heavy construction and civil engineering subsector experienced substantial fluctuations, with the highest return reaching 1,698% and the lowest touching -70%. These sharp variances are influenced by industry characteristics requiring large capital outlays, long project durations, and sensitivity to macroeconomic conditions and government policies. Such conditions require market participants to carefully understand fundamental indicators to minimize investment uncertainty risks.
A quantitative methodology was employed in this study utilizing purposive sampling for sample selection. This process yielded a total of 35 observations from 7 companies listed consistently throughout the observation period. Data analysis was conducted using panel data regression models, classical assumption tests, as well as partial and simultaneous hypothesis testing to comprehensively examine the relationships between variables.
Statistical analysis results indicate that Market Value Added (MVA) has a positive and significant partial effect on stock returns with a probability value of 0.0000. Conversely, the Price-Earnings Ratio (PER) does not have a significant partial effect on stock returns, showing a probability value of 0.8770. Nevertheless, simultaneous testing reveals that MVA and PER jointly exert a significant impact on stock returns with an F-statistic probability value of 0.000000. The coefficient of determination stands at 0.9272, indicating that 92.72% of the variation in stock returns can be explained by these two variables, while the remaining portion is influenced by other external factors.
These findings offer important implications for corporate management to focus more on creating value for shareholders in order to attract investor interest. For capital market investors, the research findings can serve as an additional reference when performing fundamental analysis more rigorously to optimize profits and manage portfolio risks.
Author Profiles
- Septiana Putri Vianida – Researcher and student at Universitas Pamulang.
- Ratna Dumilah – Lecturer and researcher at Universitas Pamulang specializing in finance and capital markets.
Research Sources
- Journal Article Title: The Impact of Price and Market Value Added Earnings Ratio for Stock Returns in Companies in Subsectors Civil engineering and heavy construction listed between 2020 and 2024 on the Indonesia Stock Exchange
- Journal Name: International Journal of Education and Life Sciences (IJELS)
- Publication Year: 2026
- DOI:
https://doi.org/10.59890/ijist.v4i9.54 - Official URL:
https://ntlmultitechpublisher.my.id/index.php/ijist
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