Determinants of Capital Structuring Of Firms of Cement Sector in Pakistan

Raheela Haqqani and Kiran Zehra
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Raheela Haqqani: Khadim Ali Shah Bukhari Institute of Technology Karachi
Kiran Zehra: Khadim Ali Shah Bukhari Institute of Technology Karachi

KASBIT Business Journals (KBJ), 2015, vol. 8, issue 1, 77-92

Abstract: In finance, capital structure is the combination of debt and equity, that how a firm finances its overall operations and growth needs by using different sources of funds. In this paper, researchers intend to identify the determinants for optimum level capital structuring in cement sector of Pakistan listed in Karachi Stock Exchange. The researchers identified that growth, size of the firm, profitability, and tangibility of assets has an effect on leverage of the firm. For this purpose 12 firms out of 20 firms listed in Karachi Stock Exchange (KSE) has been selected and data from 2006 till 20111 has been analyzed using Regression, Correlation and ANOVA to examine the determinants of capital structuring in cement sector. The results showed that all the factors have positive relationship with leverage in a firm. This study will help organization to analyze their capital structuring needs on the basis of debts and equity. Furthermore, it will increase the knowledge base of students, researchers and managers related to capital structuring.

Keywords: Capital Structuring; Profitability; Tangibility; Leverage (search for similar items in EconPapers)
Date: 2015
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