MACROECONOMIC DRIVERS OF PROFITABILITY IN BANGLADESH’S CEMENT SECTOR: A PANEL ANALYSIS OF COMPANIES LISTED ON THE DHAKA STOCK EXCHANGE

Abstract

This study assesses the relative impact of macroeconomic variables and firm-level mechanisms on the profitability of listed cement companies in Bangladesh from 2015 to 2024. A total of 70 firm-year observations across a balanced panel are used to analyze ROA and ROE through panel-regression models selected using diagnostic procedures. The findings show that the determinants explain ROA more effectively than ROE. Broad money growth has a positive and significant effect on ROA which suggests that liquidity expansion may support profitability through credit availability, construction activity, and investment demand. In contrast, leverage and cost intensity negatively affect ROA, indicating that debt burden and rising operating costs constrain profitability in this capital-intensive sector. However, GDP growth, unemployment, exchange rate movement, FDI, and monetary-condition indicators do not show strong direct effects. Overall, the findings highlight the importance of monetary conditions, debt management, cost efficiency, and firm-level resilience for cement-sector profitability.