Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

Are shareholders of a company likely to gain with a debt component in the capital employed?

user-image
Question added by Deleted user
Date Posted: 2013/08/26
Gaurav Kumar
by Gaurav Kumar , Senior Management Trainee , Raymond Ltd.

There is a simple concept rthat goes by the name of "Optimal Capital Structure".

The debt component in capital employed or in other words Leverage provieds an interset tax shield so a company gets benefitted because of that but there is an optimal mix exceeding which the heavy interests may dominate the benefits.

Optimal Capital Structure

More Questions Like This