FINANCING DECISIONS AND FIRM VALUE: EMPIRICAL EVIDENCE FROM LISTED MANUFACTURING FIRMS IN NIGERIA Section Articles

Abstract

The consequence of economic uncertainties is reflected in the fluctuating shareholder
value of firm in the Nigeria manufacturing sector. The sector experienced a severe
decline in general operation, shock in earnings and breach of debt covenant which was
primarily attributed to a reduction in disposable earnings of customers, supply chain
blockage, exchange rate fluctuation, continuous naira devaluation and increase in the
prices of major inputs due to the economic recession and the recent Covid-19 Pandemic.
This study examined the influence of financing decisions on the value of firms in the
manufacturing sectors. Descriptive and historical research design was employed and
twenty-four (24) listed firms in the sector for ten years (2016-2025) were selected using
purposive sampling method. The data for the study were extracted from the firm’s
financial statement and the Nigerian Exchange (NGX) Group website while Prais
Winsten was employed as a data estimation technique. The result revealed that external
equity, internal equity, and short-term debt have a significant positive effect on the value
of listed manufacturing firms in Nigeria. Therefore, it is recommended that the
manufacturing firms in Nigeria consider the combination of internal and external equity
and short-term debt in their financial structure to maximise the firm's value.