scholarly journals Business Life Cycle and Capital Structure: Evidence from Chinese Manufacturing Firms

2015 ◽  
Vol 23 (2) ◽  
pp. 22-39 ◽  
Author(s):  
Lin Tian ◽  
Liang Han ◽  
Song Zhang
Keyword(s):  
Life Cycle ◽  
Capital Structure ◽  
Manufacturing Firms

scholarly journals Capital Structure Theories and Speed of Capital Adjustment towards Target Capital Structure along Life Cycle Stages of Asian Manufacturing Firms

2020 ◽  
Vol 6 (1) ◽  
pp. 53-62
Author(s):  
Muhammad Sajid Amin ◽  
Hashim Khan ◽  
Imran Abbas Jaddon ◽  
Muhammad Tahir
Keyword(s):  
Life Cycle ◽  
Capital Structure ◽  
Manufacturing Firms ◽  
The Other ◽  
Mature Stage ◽  
Costs And Benefits ◽  
Speed Of Adjustment ◽  
Capital Adjustment ◽  
Life Cycle Stages

Purpose: Firms have different costs and benefits and asymmetric information across their life cycle stages and hence each stage has different financial pattern and speed of adjustment towards target capital. Methodology: We use System GMM to test the hypotheses. We use market leverages proxies for the capital structure, life cycle proxies: introduction, growth, mature, shakeout and decline and the control determinants of capital structure such as profitability, tangibility, firm size and growth opportunities. We estimate the financial pattern and speed of adjustment along life cycle stages of manufacturing firms from eleven Asian economies over the period of 2010-2018. Findings: The results show that firms in earlier stages have more long term debt than mature stage. The speed of adjustment towards target capital structure is highest in mature stage than the other stages. The control determinants significantly affect market leverages. Implications: The findings suggest that management has to consider life cycle stages of their firms in order to adjust capital structure. Stockholders should consider stage of firm with relation to profitability and capital structure for long term prospects.

Financial Life Cycle and Capital Structure

2010 ◽  
Author(s):  
Byungmo Kim ◽  
Jungwon Suh
Keyword(s):  
Life Cycle ◽  
Capital Structure

scholarly journals Determinants of Capital Structure on Trading and Manufacturing Enterprises: A Case of Nepal

NCC Journal ◽  
2019 ◽  
Vol 4 (1) ◽  
pp. 163-170
Author(s):  
Shanker Dhodary
Keyword(s):  
Capital Structure ◽  
Comparative Research ◽  
Manufacturing Firms ◽  
Coverage Ratio ◽  
Manufacturing Enterprises ◽  
Corporate Capital ◽  
Secondary Sources ◽  
Growth Opportunity ◽  
Corporate Capital Structure ◽  
Size Growth

This study mainly aimed at examining the determinants of capital structure in Nepalese trading and manufacturing firms. The study has covered eleven major on-financial enterprises of trading and manufacturing firm’s specific variables. Firm’s size, growth opportunity, asset tangibility, profitability, firm’s age, liquidity and interest coverage ratio have selected as variables to examine their effect on corporate capital structure. The study used both descriptive and causal comparative research design to examine the determinants of capital structure. Data required for undertaking the study were collected from secondary sources. For each enterprise, financial data for 10 fiscal years covering the period of F/Y 2005/2006 to F/Y 2015/2016.The study concluded that asset tangibility, profitability, liquidity and interest coverage ratio are the major determinants of corporate capital structure in Nepalese trading and manufacturing firms.

scholarly journals Pengaruh Risiko Bisnis, Life Cycle Dan Diversifikasi Terhadap Struktur Modal Serta Hubungannya Dengan Nilai Perusahaan Manufaktur Di Indonesia

2016 ◽  
Vol 9 (1) ◽  
Author(s):  
Septi Diana Sari
Keyword(s):  
Life Cycle ◽  
Capital Structure ◽  
Firm Value ◽  
Order Theory ◽  
Diversification Strategy ◽  
Single Segment ◽  
Unrelated Diversification ◽  
Related Diversification ◽  
Positive Effect ◽  
The Capital Structure

This study aims to examine the factors that affect the capital structure. The task of the financial manager is to determine the amount of capital structure to enhance shareholder value. Since the capital structure associated with firm value , this study also aimed to examine the effect of capital structure on firm value by considering the company's diversification strategy and corporate life cycle stages . By using the data obtained from the OSIRIS period 2009-2012, researchers used multiple regression test and path analysis to test the hypothesis. From the test results stated that only companies which are in the start-up phase which has a significant positive effect on the capital structure , as well as the diversification strategy has an influence on the capital structure of the company's capital structure with a sequence of related diversification > unrelated diversification > single segment. But when regressed diversification strategy with corporate values, only a single segment strategy and related diversification which significantly affect the value of the company, as well as the positive effect of capital structure on firm value. Most of the results of this study can be explained by the signaling effect and the pecking order theory. 

scholarly journals New evidences on determinants of capital structure from the Indian manufacturing industry

2016 ◽  
Vol 13 (3) ◽  
pp. 82-88 ◽  
Author(s):  
Pradeepta Sethi ◽  
Ranjit Tiwari
Keyword(s):  
Capital Structure ◽  
Manufacturing Industry ◽  
Order Theory ◽  
Manufacturing Firms ◽  
Indian Government ◽  
Pecking Order ◽  
Pecking Order Theory ◽  
Optimal Capital Structure ◽  
Financing Decisions ◽  
Size Growth

In the backdrop of Make in India push by Indian government the purpose of this study is to examine the determinants of capital structure towards a better understanding of financing decisions to be undertaken by the Indian manufacturing firms. The data for the analysis is drawn from COSPI manufacturing index of Centre for Monitoring Indian Economy (CMIE). Our sample is an unbalanced panel of 1077 firms over the period 2000-01 to 2012-13. We apply system-GMM to study different factors that affect the leverage decision of firms in India. The findings of the study reveals that the choice of optimal capital structure can be influenced by factors such as profitability, size, growth, tangibility, non-debt tax shields, uniqueness and signal. We also find the existence of both pecking order theory and static trade-off theory in the case of Indian manufacturing firms. The results thus obtained are robust across the different proxies of leverage

Determinants of capital structure; a sector-level analysis for Indian manufacturing firms

2020 ◽  
Vol 69 (5) ◽  
pp. 1033-1060 ◽  
Author(s):  
Ajaya Kumar Panda ◽  
Swagatika Nanda
Keyword(s):  
Capital Structure ◽  
Firm Value ◽  
Regression Models ◽  
Panel Cointegration ◽  
Manufacturing Firms ◽  
Content Type ◽  
Long Run ◽  
Equilibrium Relationship ◽  
Long Run Equilibrium ◽  
Non Parametric

PurposeThe purpose of this paper is to empirically analyze the determinants of capital structure and their long-run equilibrium relationships with firm-specific and macroeconomic indicators for Indian manufacturing firms.Design/methodology/approachThe study is conducted using the panel semi-parametric and non-parametric regression models to identify the key determinants of capital structure. Panel cointegration models are also employed for analyzing the long-run equilibrium association of capital structure with its determinants.FindingsThe study finds that each manufacturing sector has unique determinants of capital structure. The debt level is significantly affected by asset tangibility, growth opportunity, effective tax rate, non-debt tax shield, cash flow, profitability, firm size, foreign investment, government borrowing, economic growth, and interest rate. All these firm-specific and macroeconomic variables have strong long-run equilibrium relationship with capital structure as a whole.Practical Implication of the StudyThe study analyzes the determinants of capital structure for eight manufacturing sectors of India, which helps firm managers and policy-makers to identify appropriate factors that maximize firm value. The sector-specific features of firms may lead to a new path with regard to corporate governance and ownership structure to enhance stakeholder's satisfaction.Originality/valueThe use of semi-parametric and non-parametric panel regression models to analyze the determinants of capital structure, and the use of panel cointegration approach to explore the long-run equilibrium relationship between the determinants and its factors are the unique contributions of the present research.

Sign in / Sign up

Export Citation Format

Share Document