EFFECT OF DEBT FINANCING ON THE SHAREHOLDERS ASSET VALUE OF LISTED CONSUMER GOODS IN NIGERIA

This study examines the effect of debt financing on shareholders assets value of listed consumer goods in Nigeria from 2014 to 2023. Debt assets and debt-to-equity mix are proxies to measure debt financing, while shareholders’ assets value is proxied by Tobin’s Q. The secondary data were sourced from the individual financial reports of Nigeria’s listed consumer goods firms. The sample adopted 18 listed consumer goods firms out of the 20 listed consumer goods firms in Nigeria. This study employed a fixed-effect regression model to estimate the key relationship between debt financing and the value of the assets of the shareholders of listed consumer goods in Nigeria. The result shows that debt financing using debt assets and the debt-to-equity mix had a significant positive effect on the assets value of listed consumer goods in Nigeria. The study recommended that managers of consumer goods firms should employ optimal use of debt to enhance firm value since debt appears to be cheaper than equity. However, to avoid overleveraging, the quality of debt use (purpose, structure, and cost) must be managed. Consumer firms may need to incorporate a debt-to-equity mix into their strategic planning, focusing on optimizing their capital structure for long-term growth