Impact of Capital Structure on Firm’s Value in Manufacturing Industries

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Due To Its Interaction With Other Financial Decision Factors, Capital Structure Is One Of The Most Complicated Areas Of Financial Decision Making. The Capital Structure Of A Company Is The Mix Of Debt And Equity Capital Used To Fund Its Assets. It May Be Recast As Net Worth Plus Preferred Stock Plus Long-Term Obligations. The Issue Statement To Be Investigated In This Study Is: Does Capital Structure Effect Listed Manufacturing Businesses In India? The Study Sample Includes 12 Manufacturing Enterprises That Are Publicly Traded On The Bombay Stock Exchange. The Net Profit Ratio Is A Metric For Determining Profitability. The Capital Structure Of A Company Is Measured Using The Debt Equity Ratio, Long Term Loans To Total Assets, And Short Term Loans To Total Assets Ratios. The Results Show A Substantial Negative Relationship Between Debt And Profitability When Using Correlations And Fixed Effect Regression Analyses. This Shows That Profitable Businesses Rely On Equity As Their Primary Source Of Funding. However, Depending On The Findings, Recommendations Are Made To Enhance Specific Elements, Such As The Firm's Financial Structure.

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