Keywords: Capital Structure, Firm Performance, Food Industry, Emerging Economy .


This study aims to investigate the relationship between capital structure and profitability of food industry from an agro-based emerging economy perspective. To attain the objective, we have compiled panel data food and allied companies, representing 64% of total population, listed in Dhaka Stock Exchange and administered ordinary least square (OLS), fixed effect model (FEM), and random effect model (REM) estimate to test the impact of capital structure on the profitability of listed food companies in Bangladesh. The current study usage three proxy variables as the measure of profitability, viz., return on assets (ROA), return on equity (ROE), and earnings per share (EPS). Our panel data estimation using EViews 10 demonstrates that short term leverage has a significant negative impact on ROA (OLS model) and a strong positive impact on ROE (REM estimation) of the listed food and allied firms. However, the study do not produce any significant effects of long term debt on the firm profitability. The findings of the current study help develop the understanding of the corporate managers, investors, policy makers, and academics about the relationship between optimum financing mix and financial performance of food industries and provides valuable insights from an agro-based emerging economy perspective.

 JEL Classification Codes: G32, F65, L66, L25, M41.

Author Biographies

Md. Imran Hossain, University of Rajshahi, Bangladesh

Associate Professor, Department of Accounting and Information Systems, University of Rajshahi, Rajshahi, Bangladesh

Md. Shah Azam, Rabindra University, Bangladesh

Vice-Chancellor, Rabindra University, Bangladesh

Md. Reyad Uddin, University of Rajshahi, Bangladesh

University of Rajshahi, Rajshahi, Bangladesh

Md. Kamrul Hasan Shovon, University of Rajshahi, Bangladesh

Associate Professor, Department of Accounting and Information Systems, University of Rajshahi, Rajshahi, Bangladesh


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How to Cite
Hossain, M. I., Azam, M. S., Uddin, M. R., & Shovon, M. K. H. (2022). CAPITAL STRUCTURE AND FINANCIAL PERFORMANCE OF FOOD INDUSTRY: AN AGRO-BASED EMERGING ECONOMY PERSPECTIVE. International Journal of Accounting & Finance Review, 10(1), 53-60.
Regular Research Article/ Short Communication Article