Authors :
Muhammad Fauzan Alfaris, Bambang Santoso Marsoem
Volume/Issue :
Volume 5 - 2020, Issue 1 - January
Google Scholar :
https://goo.gl/DF9R4u
Scribd :
https://bit.ly/31ejKoR
Abstract :
One of the operational objectives of the
company is to be able to maximize the value of the
company, to meet the interests of all its stakeholders.
One way to maximize company value is by
implementing an optimal capital structure. To obtain an
optimal capital structure, companies can use the Cost of
Capital approach. The Cost of Capital approach is a
method for determining the combination of capital
costs, which consists of the Cost of Equity and the Cost
of Debt, so that the optimal capital structure is then
achieved, represented by Debt to Asset Ratio (DAR). By
taking into account the company's bankruptcy costs, an
optimal capital structure will imply maximized
company value. Then the company value that has been
obtained will be used to determine the fair price of the
company's shares using the market capitalization
approach. The results showed for 2019, PT.
Telekomunikasi Indonesia will achieve an optimal
capital structure at a DAR level of 29%, resulting in a
corporate value of Rp. 280,476 billion and a fair price of
shares of Rp. 2,831. While PT. Indosat achieved an
optimal capital structure at a DAR level of 19%, with a
company value of Rp 9,134 billion and a fair share price
of Rp 1,681. While the optimal capital structure of PT.
XL Axiata was achieved at a DAR level of 0%, bringing
the company's value to Rp 26,620 billion and the fair
price of the shares of Rp 2,491.
Keywords :
Capital Structure, Company Value, Fair Share Price.
One of the operational objectives of the
company is to be able to maximize the value of the
company, to meet the interests of all its stakeholders.
One way to maximize company value is by
implementing an optimal capital structure. To obtain an
optimal capital structure, companies can use the Cost of
Capital approach. The Cost of Capital approach is a
method for determining the combination of capital
costs, which consists of the Cost of Equity and the Cost
of Debt, so that the optimal capital structure is then
achieved, represented by Debt to Asset Ratio (DAR). By
taking into account the company's bankruptcy costs, an
optimal capital structure will imply maximized
company value. Then the company value that has been
obtained will be used to determine the fair price of the
company's shares using the market capitalization
approach. The results showed for 2019, PT.
Telekomunikasi Indonesia will achieve an optimal
capital structure at a DAR level of 29%, resulting in a
corporate value of Rp. 280,476 billion and a fair price of
shares of Rp. 2,831. While PT. Indosat achieved an
optimal capital structure at a DAR level of 19%, with a
company value of Rp 9,134 billion and a fair share price
of Rp 1,681. While the optimal capital structure of PT.
XL Axiata was achieved at a DAR level of 0%, bringing
the company's value to Rp 26,620 billion and the fair
price of the shares of Rp 2,491.
Keywords :
Capital Structure, Company Value, Fair Share Price.
