Skip to content. The excessive use of debt may endanger the survival of corporate form, while the conservative policy may deprive on advantages of cheaper debt. An appropriate capital mix influences both the return of the shareholders. With the changing business scenario; Indian business is moving towards attaining international standards as it is attracting many global players into the domestic arena in view of economic liberalization and globalization of the Indian economy.
It can be said Indian business scenario is undergoing a dramatic change. India is one of the emerging economies in the world in terms of foreign capital inflow. In order to make a mark in the global arena, India has to make huge investments in different sectors. Its corporate sector has to gear itself up for global competition.
For this purpose, effective sourcing of funds is very crucial. Against this backdrop, the study of the determinants of capital structure of the Indian firms assumes significance. Further research of this kind should enlarge our understanding of corporate finance. More Filters. We empirically examine whether firms engage in a dynamic rebalancing of their capital structures while allowing for costly adjustment.
We begin by showing that the presence of adjustment costs has … Expand. Do Firms Have a Target Leverage? Evidence from Credit Markets. The static tradeoff theory of capital structure hypothesizes that firms have a target leverage which optimizes firm value in the presence of benefits and costs of leverage such as taxes and … Expand.
Do Firms Have Leverage Targets? Evidence from Acquisitions. In the context of large acquisitions, we provide evidence on whether firms have target capital structures. We examine how deviations from these targets affect how bidders choose to finance … Expand.
Highly Influenced. View 13 excerpts, cites background, methods and results. This study examines the effects of uncertainty on firms' capital structure dynamics. We find that high-uncertainty firms have substantially lower target leverage while those firms' leverage … Expand. We employ dynamic threshold partial adjustment models to study the asymmetries in firms' adjustments toward their target leverage.
Using a sample of US firms over the period —, we document a … Expand. View 9 excerpts, cites background and methods. Capital structure adjustment behavior of listed firms on the Mexican stock exchange. In a partial adjustment model, a firm reverts its observed … Expand.
The estimates of the speed of adjustment to target leverage tend to be significant but low. One interpretation for the slow adjustment is that firms fully adjust to target only infrequently, when the … Expand.
View 8 excerpts, cites background and methods. This paper finds strong support for the argument that heterogeneous adjustment costs significantly affects the speed with which a firm approaches its target capital structure. We find that firms with … Expand. View 5 excerpts, cites background, results and methods. Using a sample of US firms during —, we document a negative … Expand. Testing the pecking order theory of capital structure. Journal of Financial Economics, 67 2 , Graham, J. Market timing ability and volatility implied in investment newsletters' asset allocation recommendations.
Journal of Financial Economics, 42 3 , Henriksson, R. On market timing and investment performance: Statistical procedures for evaluating forecasting skills. Journal of Business, 54 4 , Hermalin, B.
The determinants of board composition. Hirshleifer, D. Managerial conservatism, project choice, and debt. Review of Financial Studies, 5 3 , Hovakimian, A. Are observed capital structures determined by equity market timing? Journal of Financial and Quantitative Analysis, 41 1 , Huang, R.
Testing the market timing theory of capital structure. Journal of Financial and Quantitative Analysis, 1, Kayhan, A. Journal of Financial Economics, 83 1 ,
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