Investment Opportunity Set Role as Mediating The Effect Of Diversification to Companies Value in Indonesia (Empirical Study Of Go Public Secondary Sector Companies)

摘要

Purpose - This study aims, first, to measure and to interpret the effect of diversification on company value, and second, to measure the role of Investment Opportunity Set (IOS) as the mediating effect of diversification to company value. Design/methodology/approach - This study uses a quantitative approach with paradigm positivism. This empirical research object is the go public secondary sector companies at Indonesia Stock Exchange (ISE). This study use sample 18 companies. Observation period is 2006-2010. The method of data analysis is Structural Equation Model (SmartPLS software) Ver 2.0 M3. Findings - First, diversification has significant and positive effect on company value. Second, IOS acts as a partial mediating effect of diversification to company value. Research limitations - The study is not concerned with the qualitative, e.g. management and customer service. The reason is lack of information qualitative data. This assessment is only a kind of financial portrait moment and, of course, contains many limitations. Moreover, the researchers did not check again whether the financial report is true, that in accordance with the conditions of the company, without engineering. Practical implications - The research could be an important input to regulators such as the company's managers, board of directors, and the board of commissioners in deciding investment opportunities and to explain the information disclosure or publication on Stock Exchange in the online media. For potential investors, this study describes the company prospects before buying shares at secondary sector. Originality/value - This research fills opposition research results of previous studies, by including IOS as a mediating variable, the effect of diversification on company value. These variables can explain the emergence of the gap with the object of observation on go public secondary sector companies in Indonesia.