The impact of leverage on firm investment - Evidence from listed companies on Ho Chi Minh stock exchange
Abstract
With an empirical analysis of Vietnam market, the study attempts to determine
the relationship between financial leverage and firm investment. The sample of balanced
panel data is collected from Hochiminh Stock Exchange for the period 2009-2013, with 135
companies representing all industries. The findings from regression analysis prove the
negative impact of leverage on firm investment. Furthermore, it also reveals the more
intensive depressing effects of debt financing on firms with low growth opportunities
compared to companies with high growth prospects.
Key words: leverage, debt financing, investment, growth opportunities, SOE, soft budget
constraint