Taking a Look at Capital Structure

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Literature Review:
Rao (2001) made an attempt to explain the variation of capital structure across industries in India during pre and post liberalization regime and also examine if there is any significant change in average industry level capital structure during post liberalization regime. The study is based on industry wise data of 85 industries in manufacturing sector the results shows that there has been significant decrease in leverage during post liberalization regime and there has been change in set of explanatory variables for capital structure. The most significant explanatory variables for capital structure during pre liberalization regime were the measure of profitability, risk and asset type. During post liberalization regime measure of profitability, growth and asset type were the most significant variables.
Bhaduri (2002) studied the capital structure choice in developing countries through a case study of Indian corporate sector, for the period 1989-90 to 1994-95, based on a sample of 363 firms across nine industries. The author has reported optimal capital structure choice is influenced by factors such as growth, cash flow size and product industry and characteristics.
Gupta (2004) conducted a study of a sample of 210 companies reporting the seventeen industrial sector in India for 1992-2000 period by using ANOVA and multiple linear regression model. The study found significant variation in debt-equity ratio in industrial sector. The cement
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