Determinants of Financial Structure of Corporate Sector in India- Some Empirical Evidence

A. Vijayakumar

Management and Labour Studies, 2009, vol. 34, issue 4, 471-487

Abstract: The number of changes have been taken place in the Indian financial scenario such as government policy with increasing emphasis on liberalization, increasing incentives for global investments, emergence of new means and instruments like GDR, Euro-Issues, FDI, Futures, Options, Swaps etc., have entered the Indian financial Market in to the new era. The change in the financial market certainly has got impact on the financing pattern of corporate sector in India. Over the past, many researchers have tried to establish the factors which influence a firm's financial structure. Some of them have presented affirmative evidence in respect of a particular factor or a group of factors as determinant of corporate financial structure, others have presented dissenting evidence in respect of the same factor or factors to be a clear determinant of financial structure. Hence in this study, an attempt has been made to study the corporate financial structure relationship with reference to size, profitability, operating leverage, external financing and Income gearing. The overall analysis leads to the conclusion that Industry class, size and profitability are the most significant factors which influence, to a great extent, the financial structure of Indian Automobile Industry.

Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:sae:manlab:v:34:y:2009:i:4:p:471-487

DOI: 10.1177/0258042X0903400402

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