ASSET STRUCTURE AND MARKET CAPITALIZATION OF QUOTED CONSUMER GOODS COMPANIES IN NIGERIA

Abstract

Assets are essential resources to quoted companies for the purpose of generating revenue. Managers of quoted companies are expected to acquire and accumulate these assets in such a way that profits as well as shareholders’ wealth are maximized. Quoted consumer goods companies in Nigeria are not excluded as assets are used in conducting business activities. Thus, it is important to assess the influence of asset structure on market capitalization of these entities. This study was conducted to examine the influence of asset structure on market capitalization of quoted consumer goods companies in Nigeria from 2013 to 2022. The ex-post facto research design was employed in the study. The population was twenty-one (21) consumer goods companies on the floor of Nigerian Exchange Group (NGX) as at December 2022. The census sampling method was adopted as the twenty-one (21) entities were studied on the basis of availability of data in accordance with the variables of the study. The dependent variable was Market Capitalization (MCAP) while the independent variable was Asset Structure (AS) measured by Tangible Assets (TANG) and Intangible Assets (ITA). Panel data were collected from annual reports and financial statements of the sampled entities from 2013 to 2022. The data were analyzed using descriptive and inferential statistics. Fixed effect linear regression technique was used in the study. From the analyses, it was revealed that TANG and ITA had positive and significant influence on MCAP of quoted consumer goods companies in Nigeria (TANG, β=3.9465, t-stat=13.488, p-value=0.0000, Adjusted R2=0.7924 and ITA, β=5.7252, t stat=3.5569, p-value=0.0005, Adjusted R2=0.5512). It was concluded that intangible assets exerted the highest influence on market capitalization of quoted consumer goods companies in Nigeria. It was recommended that adequate investment and effective management should be done on the key variables of assets structure such as tangible and intangible for the purpose of influencing positively and significantly on market capitalization of the entities in Nigeria.