IJFAM
Article Details
Vol. 8 No. 2 (2026): September
Debt Financing and Value Creation of Listed Consumer Goods Firms in Nigeria
Abstract
Purpose: This study examines the effect of debt financing on value creation of listed consumer goods firms in Nigeria. The specific objectives were to assess the effect of total debt to asset ratio, total debt to equity ratio, and long term debt to asset ratio on value added measured by value added to sales ratio, with firm size included as a control variable.
Research Methodology: An ex post facto research design was adopted, and the population consisted of twenty listed consumer goods firms in Nigeria, from which fifteen firms were selected using purposive sampling based on data availability from 2012 to 2024.
Results: The findings revealed that: total debt to asset ratio had a significant negative effect on value creation while total debt to equity ratio and long-term debt to asset ratio had a significant positive effect on value creation at 5% significance level.
Conclusions: In conclusion, different forms of borrowing do not transmit uniformly into operational output, as short term pressure embedded in asset heavy debt structures tends to suppress output efficiency while structured long term commitments appear to support stable production processes.
Limitations: The study used only fifteen listed consumer goods firms because of data availability, which may not represent all firms in Nigeria.
Contributions: This study contributes to the existing literature by addressing two important gaps in previous empirical works on debt financing and firm outcomes.
Keywords
Debt Financing
Value Creation
Value Added
Consumer Goods Firms
How to Cite
Nweke-Charles, U. E. ., Ene, N. L., Elom, J. O., Nwuzor, C. M., Chinyere, O. B. ., & Cyril6, . U. O. (2026). Debt Financing and Value Creation of Listed Consumer Goods Firms in Nigeria. International Journal of Financial, Accounting, and Management, 8(2), 341–354. https://doi.org/10.35912/ijfam.v8.n2.p341-354.2026
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