Financial Ratios Analysis: Prediction of Financial Distress of Plantation Sub-sector Companies Listed on the Indonesia Stock Exchange

Abstract

Plantation sub-sector companies have an important role in the Indonesian economy. The uncertain economic situation does not necessarily make the plantation sub-sector slump, but this sub-sector continues to contribute to the Indonesian economy. This study aims to determine the effect of liquidity, leverage, profitability, activity, and growth on the financial distress of plantation sub-sector companies listed on the IDX 2019-2021. This research is a quantitative research with a descriptive approach. The data used in this study is secondary data, namely in the form of financial reports obtained from the official website of the Indonesia Stock Exchange. The research population is plantation sub-sector companies listed on the Indonesia Stock Exchange, the sampling technique used was purposive sampling so that 23 companies were obtained as research samples. The analytical method used includes descriptive statistical analysis, multicollinearity test, and hypothesis testing using logistic regression processed through the SPSS application. The results of this study indicate that liquidity and activity have an effect on financial distress. Meanwhile, leverage, profitability, and sales growth have no effect on financial distress.