Capital structure - case study, finance, Other Engineering

Assignment Help:
The following is the capital structure of X ltd on 31st Dec2003

Rs in million

Equity capital (paid up) 563.50

Reserves and surplus 485.66

10% Irredeemable preference shares 56.00

10% Redeemable preference shares 28.18

15% Term loans 377.71

---------------------------------------
Total 1511.05


The share of the company is currently selling for Rs 36. The expected dividend next year is Rs 3.60 per share anticipated to be growing at 8% indefinitely. The redeemable preference shares were issued on 1 January 1997 with twelve-year maturity period. A similar issue today will be at Rs 93. The market price of 10% irredeemable preference share is Rs 81.81. The company had raised the term loan from IDBI in 1993. A similar loan will cost 10% today.

Assume an average tax rate of 35 percent. Calculate the weights average cost of capital for the company using book-value weights.


Related Discussions:- Capital structure - case study, finance

LTE, WHATIS LTE CODING TECHNIQUES USE FOR MOBILE SYSTEM

WHATIS LTE CODING TECHNIQUES USE FOR MOBILE SYSTEM

Imaging seekers , Imaging Seekers  Although there are a wide variety...

Imaging Seekers  Although there are a wide variety of imaging sensors (cameras), the majority of modern aircraft systems are based on conventional TV camera technologies (al

Engine speed indicators, Engine speed indicators: All engines have thei...

Engine speed indicators: All engines have their rotational speed (R.P.M.) indicated. On a twin or triple-spool engine, the high pressure assembly speed is always indicated; in

Alternative escape routes - means of escape, Alternative escape routes: ...

Alternative escape routes: Does everyone have access to the alternative routes or do some people have no choice about which way they go? Are all the escape routes

Feathering the propeller, Feathering the propeller: If there is an engi...

Feathering the propeller: If there is an engine failure in flight, the propeller would windmill creating drag and increasing any damage that had occurred in the engine. Feathe

Instruction set, compare zero- one- two- and three-address machines by writ...

compare zero- one- two- and three-address machines by writing programs to compute X=(A+B*C)/(D-E*F)

Engineering physics 1, scaning electro microscope,transmission microscope

scaning electro microscope,transmission microscope

Function, what is function independence.on software engineering

what is function independence.on software engineering

Electrical engineering (power system analysis), I have a project in power f...

I have a project in power flow analysis. The project topic is: Study of Load impact on power flow (constant power, constant impedance, constant current, induction motor) and use th

Fire prevention - fire risk assessment, Fire prevention - fire risk assessm...

Fire prevention - fire risk assessment: Fire prevention measures include: Reducing the combustible materials, Reducing the risk of ignition, Reducing

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd