Asia-Pacific Journal of Business (아태비즈니스연구)

KNU The Institute of Management & Economy Research (강원대학교 경영경제연구소)
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Information Effect of New Office Investments and Determinant of Firm Value

사옥신축의 정보효과와 기업가치 결정요인에 대한 연구

  • Lee, Jin-Hwon (Division of Business Administration, Osan University) ;
  • Lee, Po-Sang (Department of Finance & Tax Management, Songwon University)
  • 이진훤 (오산대학교 경영계열) ;
  • 이포상 (송원대학교 금융세무경영학과)
  • Received : 2020.08.31
  • Accepted : 2020.09.21
  • Published : 2020.09.30
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Abstract

Purpose - This study examines the information effect of the disclosure of new office investments on the Korean stock market and investigates determinant of performance of sample firms. Design/methodology/approach - The sample consists of companies listed on the Korean Exchange that announced investments in new office construction for eleven-years from January 2007 to December 2017. It analyzes excess return using event study methodology and studies the determinants of abnormal return with multiple regression analysis. Findings - We find that abnormal returns of the short and long window are positive on average and statistically significant. In particular, CAR of high growth subsample is a larger positive return than that of the low one both short and long window. Difference in abnormal returns by investment size is observed only in short time window. But there is not observed difference by cash holding level. Research implications or Originality - This finding is able to be added to the evidence of the theory of corporate value maximization academically. Moreover, it shows the possibility that building a new office can have a positive effect on corporate value. It is expected to help investors make decisions because it can provide useful information to market participants in practice.

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