Influence of factors on the financial profitability of listed plastic industry enterprises in the Vietnam stock market

Abstract

This article analyzes the factors influencing the financial profitability, measured by the Return on Equity (ROE), of listed plastic industry enterprises on the Vietnam Stock Market during the period 2018-2024. Utilizing data from 26 enterprises (182 observations) and econometric models (FEM, REMandFGLS), the study evaluates the impact of asset turnover (AR), debt ratio (DA), asset growth rate (GA), cost of goods sold ratio (GV), and firm size (FS) on ROE. The adjusted regression results indicate that AR (β=0.0482, p<0.001) and GA (β=0.0266, p<0.01)exert positive effects, whereas GV (β=-0.403, p<0.001) substantially diminishes ROE. DA and FS lack statistical significance and do not conform to the hypotheses positing a negative impact of the debt ratio (DA) on ROE and a positive impact of firm size (FS) on ROE.The research findings underscore the imperative of enhancing profitability through the rational utilization and optimization of assets, coupled with adjustments to production costs. Accordingly, several proposed solutions are advanced, including improving fixed asset efficiency, effective management of inventory and accounts receivable, restricting borrowing, and investing in green technologies. The study contributes additional scholarly insights into financial management within the plastic industry, furnishing a foundation for managers and investors to formulate long-term enterprise strategies. Owing to limitations such as a small sample size (182 observations), persistent autocorrelation, heteroscedasticity, and constraints in industry scope, future research should expand datasets and refine analytical methodologies.