ANALYZING THE RELATIONSHIP BETWEEN CAPITAL STRUCTURE, SHAREHOLDING PATTERN, AND FINANCIAL PERFORMANCE OF THE INDIAN AUTOMOBILE INDUSTRY
Dr Ankur
Management
Feburary 2024
This study analyzes the connection between capital structure, shareholding pattern, and financial performance exhaustively, diving into the capricious parts of the Indian auto area. With the utilization of a powerful exploration framework, the review takes a gander at the connection between the shareholding patterns of the associations nearby and the capital structure choices they make, for example, financing and commitment equity extents. Whether or not capital structure components and financial performance are connected is disputable. The reason for this study is to comprehend the way that financial backers' returns advance corresponding to the piece of capital structures. Both pooled relapse and board relapse (fixed effects and random effects models) were utilized with fifteen years of information from sixteen auto associations, and the Hausman test and Wald test were utilized to choose the best-fitting model. The Good Effects model was viewed as the best fit, as proven by the way that both equity and transitory obligation adversely affect return on equity (ROE) and are profoundly quantifiably enormous. Almost 57% of the variation in ROE was explained by the model, and there was no autocorrelation problem in the error component. The evaluation is crucial for decision-making for both enterprises and financial backers because it reveals that the composition of the capital structure makes sense when it comes to ROE
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