A descriptive study on Capital structure determinants

Abstract

Capital structure is the long-term funding strategies of an organisation. The concept of "total capital structure" pertains to the manner in which an organisation secures long-term funding, encompassing both internal and external contributions. When selecting its financing mix, a company ought to optimise its value while reducing its overall cost of capital. Frequently, the dilemma of determining the ideal debt-to-equity ratio confronts financial managers. The financial structure, or capital structure, of a business entity delineates the manner in which it consolidates different types of financing in order to support its operational activities. Developing economies, such as India's, must prioritise the identification and analysis of the funding dynamics pertaining to their most significant contributory industry. Capital utilisation and the capacity of a business to secure funding are both critical determinants of its success and the overall vitality of the sector. This study demonstrates the significant factors that influence the capital structure, which is crucial for the practical application of financial studies.