Determining the impact of Capital Structure on Economic Value Added with reference to select Pharmaceutical companies listed in National Stock Exchange Purswani Geetanjali1,*, Raj Anand2,** 1Assistant Professor, Dept. of Commerce, Christ University, Bengaluru-29 2PG Research scholar, Christ University, Bengaluru-29 *Corresponding Author E-mail: geetanjali.purswani@christuniversity.in
**samuelanandraj7@gmail.com
Online published on 2 June, 2018. Abstract The investors are looking for companies that can add more to their wealth. It is important for companies to maintain good market value, this is possible only when the company strives to increase Econmic Value Add (EVA), better the EVA better the firm's ability to meet its cost of capital. When company exceeds its Net Operating Profits over Cost of capital EVA will be positive. The company can increase the shareholders value only by enhancing EVA. On the other side the value of EVA is also determined by the decisions made by the firms on their capital structure. This study attempts to measure the relationship between Capital structure and EVA. Five Pharmaceutical companies listed in NSE have been taken and analysis is done for a period of five years (2013–2017) with the help of Microsoft Excel. To measure the relationship between Capital Structure and Economic Value Added and Regression analysis is done to measure the impact of Capital Structure on Economic Value Added. Results of the study reveals Capital Structure does not significantly impact on the value of EVA. Top Keywords Capital Structure Cost of Capital, Economic Value Added (EVA), Profitability Position. Top |