Impact of Firm Characteristics on Cash Holding Of Pakistani Firms

Abstract

The study focuses on impact of firm characteristics on cash holding of textile sector of Pakistan. Study considers firm characteristics (cash flow, size, leverage and dividend payout ratio of firms) as independent variable while cash holding as dependent variable. Five types of textile industries that are used for the data analysis and calculations: Textile spinning, textile weaving, textile composite, woolen, synthetic and rayon. Annual financial statements of fifty‐nine firms have been used for data collection regarding variables of this study from the period of 2008 – 2017 and total of 590 observations were observed. Collected data has then been analyzed through statistical instruments such as correlation and regression by using E‐views. Data analysis has shown that small size firms have positive impact on cash holding in textile firms of Pakistan while large size firms, low and high cash flow firms, leveraged firms and dividend paying firms have negative impact on cash holding