Abstract:
Capital structure is the way a company arranges its finances through a combination of equity and debt. It is designed with the aim of maximizing the market value of the company in the long run. The study seeks to explore the determinants of capital structure with the financial leverage of the Indian listed Automobile companies for the period 2008-09 to 201 4 -15. Automotive industry is perhaps the greatest engine of economic growth. In India, automobile is one of the largest industries, showing impressive growth and has been significantly contributing to the overall industrial development in the country. The determinants include liquidity, size, tangibility, profitability, risk, non-debt tax shield and growth. The study employs the Panel Data Models to examine the relation between capital structure determinants and financial leverage. The study has revealed that profitability, growth and tangibility significantly influence the financial leverage.
