Behind the Veil

Unveiling the Mysteries of Net Trade Credit Determinants in the Cement ‎Sector

Authors

  • Farah Naz Naqvi Hailey College of Banking and Finance, University of the Punjab, Lahore, Pakistan.‎ Author
  • Waqar Ali Athar Bukhari Higher Education Department, Lahore, Punjab, Pakistan Author
  • Azaz Ali Athar Bukhari Department of Economics, Division of Management and Administrative Science, University of ‎Education, Lahore, Pakistan Author
  • Amber Pervaiz Department of Economics, Division of Management and Administrative Science, University of Education, Lahore, Pakistan Author

DOI:

https://doi.org/10.68379/qc0xj093

Keywords:

Net trade credit, External financing, Trade receivable, Firms competitiveness, Cement sector

Abstract

This study presents a comprehensive investigation into the determinants of net trade credit within Pakistan's cement industry. Highlighting net trade credit's significance as a vital source of short-term external financing, the research explores various influencing factors, including firm size, age, operating cash flow, export propensity, market share, liquidity, financial distress, inventories, bank finance, and sales growth. Employing generalized least squares, fixed effect, and random effect model, the study identifies the fixed effect model as the most appropriate. Notably, it reveals that smaller firms, those with lower market share, and newly established entities tend to invest less in trade. Conversely, higher levels of operating cash flow, liquidity, financial stability, export propensity, sales growth, bank finance, and inventory are associated with increased investment in trade receivables. These findings underscore the crucial role of these factors in shaping firms' financing strategies within Pakistan's cement industry.

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Published

15-12-2023

Issue

Vol. 1 No. 2 (2023): DSJHSS 1-2

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Articles

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Copyright (c) 2023 farah, waqar, aziz, amber (Author)

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How to Cite

Naqvi, F. N., Bukhari, W. A. A., Bukhari, A. A. A., & Pervaiz, A. (2023). Behind the Veil: Unveiling the Mysteries of Net Trade Credit Determinants in the Cement ‎Sector. Dyal Singh Journal of Humanities & Social Sciences, 1(2), 20-31. https://doi.org/10.68379/qc0xj093

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