Determinants of Capital Structure in Indian Manufacturing Sector

2012 ◽  
Vol 8 (3) ◽  
pp. 265-269 ◽  
Author(s):  
Harsh Purohit ◽  
Shivi Khanna
2015 ◽  
Vol 12 (1) ◽  
pp. 3-14 ◽  
Author(s):  
Saurabh Chadha ◽  
Anil K. Sharma

Purpose – The purpose of this paper is to study the key determinants of capital structure for Indian manufacturing firms and which theory implications, i.e. trade off vs pecking order are more applicable in current Indian manufacturing sector scenario. Design/methodology/approach – A sample size of 422 listed Indian manufacturing companies on Bombay Stock Exchange has been considered to do the empirical evaluation. A ten year period from 2003-2004 to 2012-2013 and annual financial standalone data have been considered for study. Ratio analysis and panel data approach have been applied to perform the empirical evaluation. Total debt to total capital and total debt to total assets are used as the proxy for firm financial leverage. Findings – It was empirically found that size, age, asset tangibility, growth, profitability, non-debt tax shield, business risk, uniqueness and ownership structure are significantly correlated with the firm financial leverage or key determinants of capital structure in Indian manufacturing sector. Also, other variables like dividend payout, liquidity, interest coverage ratio, cash flow coverage ratio (CFCR), India inflation and GDP growth rate are empirically found to be insignificant to determine the capital structure of Indian manufacturing sector. There is no single theory implications, i.e. trade off vs pecking order which can explain the capital structure nature of Indian manufacturing sector and rather it is a mix of both the theories. Originality/value – The findings of the study would enhance the literature on capital structure and is significant for the Indian manufacturing firm’s decisions as it includes the most recent data and covers the period of both pre- and post-recession of 2008-2009.


GIS Business ◽  
2017 ◽  
Vol 12 (4) ◽  
pp. 47-52
Author(s):  
Karam Pal Narwal ◽  
Sonia Jindal

The paper empirically examines the impact of corporate governance on the cash holding of the firms. The components of corporate governance are measured by board size, board meeting, audit committee members, directors remuneration and non executive directors and the cash holding is measured with the log of average cash and size is taken as control variable for the control effect on the dependent variables. Moreover, correlation and panel regression model were employed to examine the relationship between the corporate governance and cash holding. Empirical data was collected from 96 firms over the period of 2004-05 to 2013-14. The results show that directors remuneration and the number of audit committee members positively influence the cash holding and the board size also positively influences the cash holding whereas, the non executive directors and the board meetings do not play any role in enhancing the cash holding.


Author(s):  
Deepak Singhal ◽  
Aneesh Kuruvilla ◽  
Biswajit Mohapatra ◽  
Sushnata Tripathy

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