The Effect of Covid-19 on the Determinants of Profitability: A Study from Bangladesh

Abstract

The purpose of this study is to explore the results of firm’s internal factor on profitability of quoted thirty corporations in country before Covid-19 pandemic and during Covid-19 pandemic era. During this study, information of thirty corporations that were active in Dhaka stock exchange (DSE) between the years 2018-2019 to 2020-2021 has been used. As indicators of firm profitability, return on Assets and net income are used whereas size, growth rate, tangibility and leverage has been used as indicators of internal factors. The research design uses descriptive quantitative analysis. Sampling technique uses purposing document review, with some preset criteria; the number of sample is thirty firms. The analysis techniques used are col linearity, correlation matrix and multiple linear regression models. Before pandemic situation the internal factors determined or explained only close to one fifth percent changes in profitability. The research results shows that the profitability (ROA) and firm size partly have negative correlation and not vital on it in both before covid19 and during the breakout. The liquidity and assets growth both partly have negative impact and positive impact considerably on profitability (ROA).Before the breakout growth had a negative and leverage had a positive impact on ROA Then during breakout it went the opposite way for both variables. The tangibility partially had no impact on profitability (ROA); however after pandemic breakout it had influences on the firms’ profitability (ROA). As the hypothesis was “There is no significant effect of a firm’s internal factor on profitability for Bangladeshi firms before and during pandemic time.” the conclusion is that the hypothesis is null or not valid.