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What is the optimal capital structure?

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Question added by Ali Ibrahim , Head of Investor Relations , Qalyubia Governorate
Date Posted: 2017/12/08
Ibraheem AL-Aamri
by Ibraheem AL-Aamri , Financial Accountant , Oman LNG L.L.C

The optimal capital structure of the company depends on the industry norms in which its operate. For a company that is operating in utility industry,energy,telecomunication industry, it will have more debt than equity.

 

Some argue that 50:50 debt to equity ratio is rquired. And other say that since debt is cheap and could help in avoiding paying more tax however, with team it could be a cause of financial stress of any company.

 

so its really depend on the company and its industry, there is no straight ansewr. 

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