Open Access Open Access  Restricted Access Subscription Access

DETERMINANTS OF CAPITAL STRUCTURE – EVIDENCE FROM INDIAN STEEL COMPANIES

D. Geetha, A. Karthika

Abstract


The steel sector is one of the sectors playing most crucial role in the development of a nation and is considered as the backbone of civilization. The Indian steel industry has entered a new development stage since 2007-2008 and is riding on the resurgent economy and the growing demand for steel. India’s 33 percent growth in steel production in the last five years was second only to China among the top five steel producing nations (World Steel Association - WSA). The research study focuses on evaluating the determinants and the combination of capital structure of selected steel companies in India for a period of 10 years from 2004-2005 to 2013-2014 to find out the optimum capital structure to maximize profits in the steel industry in India. The correlation analysis and multiple regression analysis methods were adopted to carry out the study.

Keywords


Capital structure, Debt to capital, Return on assets, Return on equity, Earnings per share, Asset growth.

Full Text:

PDF

References


Bauer P. (2004). “Determinants of Capital Structure Empirical Evidence from the Czech Republic”, Czech Journal of Economics and Finance, Vol.54, pp.1-2.

Chen LH, Lensik R, and Sterken E. (1998). “The Determinants of Capital Structure: Evidence from Dutch Panel Data”, Proceedings of European Economic Association Annual Congress, Berlin, Sep 2-5.

Chisti KA, Ali K, and Sangmi MD. (2013). “Impact of capital structure on profitability of listed companies (evidence from India)”, The USV Annals of Economics and Public Administration, Vol.13(1), p.17.

Goyal AM. (2013). “Impact of Capital Structure on Performance of List Public Sector Banks in India”, International Journal of Business and Management Invention, Vol.2(10), Oct., pp.35-43.

Handoo A, and Sharma K. (2014). “A study on determinants of capital structure in India”, IIMB Management Review, Vol.26, pp.170-182.

http://www.bajajsteelindustries.com

http://www.businessdictionary.com

http://www.sail.co.in

http://www.tatasteel.com

http://www.thehindubusinessline.com/economy/macro-economy/indias-steel-demand-likely-to-grow-34-this-year-wsa/article6475416.ece

Leon SAJ. (2013). “The impact of Capital Structure on Financial Performance of the listed manufacturing firms in Sri Lanka”, Global Institute for Research & Education, Vol.2(5), pp.56-62.

Mishra CS. (2011), “Determinants of Capital Structure – A Study of Manufacturing Sector PSUs in India”, International Conference on Financial Management and Economics, IPEDR vol.11 (2011) © (2011) IACSIT Press, Singapore.

Modigliani F, and Miller MH. (1958). “The Cost of Capital, Corporation Finance and the Theory of Investment”, The American Economic Review, Vol.48(3), Jun, pp.261-297.

Mohammadzadeh M et al. (2013). “The Effect of Capital Structure on the Profitability of Pharmaceutical Companies the Case of Iran”, Iranian Journal of Pharmaceutical Research, Vol.2(3), pp.573-577.

Pandy IM. (2010). “Financial Management”, Vikas Publishing House, New Delhi.

Rayan K. (2008), “Financial leverage and firm value”, Gordon Institute of Business Science, University of Pretoria.

Sharma RK, and Gupta SK. (2010). “Financial Management”, Sultan Chand & Sons, New Delhi.

Song HS. (2005). “Capital Structure Determinants an Empirical Study of Swedish Companies”, International PhD Workshop on Innovation, Entrepreneurship and Growth, Royal Institute of Technology (KTH), Stockholm.

Sovbetov Y. (2013). “Relationship between Capital structure & Profitability”, Dissertation, Cardiff Metropolitan University, May.


Refbacks

  • There are currently no refbacks.


Send mail to ijsar@ijsar.com with questions or comments about this web site. 

International Journal of Social and Allied Research, All rights reserved.