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Determinants Of Capital Structure: A Quantile Regression Analysis

Listed author(s):
  • AVIRAL Kumar Tiwari

    (Faculty of Management, IFHE University, IBS Hyderabad, India)

  • RAVEESH Krishnankutty

    (Faculty of Management, IFHE University, IBS Hyderabad, India)

In this study, we attempted to analyze the determinants of capital structure for Indian firms using a panel framework and to investigate whether the capital structure models derived from Western settings provide convincing explanations for capital structure decisions of the Indian firms. The investigation is performed using balanced panel data procedures for a sample 298 firms (from the BSE 500 firms based on the availability of data) during 2001-2010. We found that for lowest quantile LnSales and TANGIT are significant with positive sign and NDTS and PROFIT are significant with negative sign. However, in case of 0.25th quantile LnSales and LnTA are significant with positive sign and PROFIT is significant with negative sign. For median quantile PROFIT is found to be significant with negative sign and TANGIT is significant with positive sign. For 0.75th quantile, in model one, LnSales and PROFIT are significant with negative sign and TANGIT and GROWTHTA are significant with positive sign whereas, in model two, results of 0.75th quantile are similar to the median quantile of model two. For the highest quantile, in case of model one, results are similar to the case of 0.75th quantile with exception that now GROWTHTA in model one (and GROWTHSA in model two). Classification-JEL:

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File URL: http://eccsf.ulbsibiu.ro/RePEc/blg/journl/1012aviral&raveesh.pdf
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Article provided by Lucian Blaga University of Sibiu, Faculty of Economic Sciences in its journal Studies in Business and Economics.

Volume (Year): 10 (2015)
Issue (Month): 1 (April)
Pages: 16-34

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Handle: RePEc:blg:journl:v:10:y:2015:i:1:p:16-34
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Lucian Blaga University of Sibiu, Faculty of Economic Sciences Dumbravii Avenue, No 17, postal code 550324, Sibiu, Romania

Phone: 004 0269 210375
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