The Effectiveness of Working Capital Use to Maximize Company Value

: A Study on Telecommunication Companies in Indonesia

Abstract

This research is driven by the notion that companies will not be able to develop in difficult situations. The telecommunications construction companies are facing great pressure after their golden era. Government regulation and tight business competition force these companies to create new strategies to survive and if possible, to develop the business. The objective of this research is to analyze how the telecommunication construction companies survived in the difficult business era. This research also aims to reveal the comparison of the effectiveness of the availability of the working capital with the project value to be conducted within a year. In addition, this research also tries to reveal how the strategies used to provide the working capital needed could benefit and increase the company value. This is an explanatory research with qualitative approach. This research was conducted in Surabaya with the sample consisted of three telecommunication construction services companies. The results show that increasing the effectiveness of all business sectors is the main key to increase the company value. In terms of working capital, the effective working capital availability which is 18.3% of the project value in a year will guarantee the successful project implementation. The use of working capital is a determinant factor in increasing company value in the difficult situations.