Financial Decision
Financial Decision
A study on Capital Structure
Presented By:
Badesaab Ankalgi
Iranna Patil
Ruben Stanley
Bhagyashree Kulkarni
Iravva Harijan
Industry Overview- IT
The sector has increased its contribution to
India's GDP from 1.2% in 1998 to 7.5% in 2012
Revenues $100 billion in 2012
Export and domestic revenue stood at $69.1 and
$31.7 billion respectively
Growing annually by 9%
Generates 2.5 million direct employment annually
Share in total exports increased from 4% to 25% from 1998 to 2012
Globalization has given a positive result for all the
IT industries
Rolta India
Share Capital
161.33 161.33 161.33 161.33 161.19
Reserves & Surplus
2868.9
Net Worth
Equity Dividend (%)
22.5
30
30
35
32.5
2383.5 2304.45 2142.23 1743.13
3030.23 2544.83 2465.78 2303.56 1904.33
Book Value (Rs)
187.83 157.74 152.84 142.79 118.14
250
7000
6000
200
5000
150
4000
Net Worth
Book Value (Rs)
Reserves & Surplus
3000
Share Capital
Equity Dividend (%)
100
2000
50
1000
0
1
2
3
4
5
0
1
2
3
4
5
Debt Equity
Ratio
Close Price
0.81
0.86
0.87
0.35
0.63
3453.55 3287.35 3297.9 1854.75 2331.25
Interpretation:
As we can see here that in spite of there is increase in the Debt equity ratio there is a steady growth in the Market price of Rolta that is because
IT sector Doesn’t need any much investment and work on low investments also so, there is no much impact of Debt on the price in the market. Debt taken is signaled as good for the investors. And we can see there is variable dividend policy which also is not effecting the market price of rolta.
Polaris
Share Capital
49.78
Reserves & Surplus
Net Worth
49.75
49.76
49.6
49.48
1125.83 1037.89
979.2
867.51
730.6
1175.6 1087.64 1028.95
917.11
780.08
2500
Equity Dividend
(%)
125
Book Value (Rs)
100
100
90
70
118.09 109.3 103.47 92.45 78.83
300
250
2000
200
1500
Net Worth
Reserves & Surplus
Book Value (Rs)
150
Equity Dividend (%)
Share Capital
1000
100
500
A study on Capital Structure
Presented By:
Badesaab Ankalgi
Iranna Patil
Ruben Stanley
Bhagyashree Kulkarni
Iravva Harijan
Industry Overview- IT
The sector has increased its contribution to
India's GDP from 1.2% in 1998 to 7.5% in 2012
Revenues $100 billion in 2012
Export and domestic revenue stood at $69.1 and
$31.7 billion respectively
Growing annually by 9%
Generates 2.5 million direct employment annually
Share in total exports increased from 4% to 25% from 1998 to 2012
Globalization has given a positive result for all the
IT industries
Rolta India
Share Capital
161.33 161.33 161.33 161.33 161.19
Reserves & Surplus
2868.9
Net Worth
Equity Dividend (%)
22.5
30
30
35
32.5
2383.5 2304.45 2142.23 1743.13
3030.23 2544.83 2465.78 2303.56 1904.33
Book Value (Rs)
187.83 157.74 152.84 142.79 118.14
250
7000
6000
200
5000
150
4000
Net Worth
Book Value (Rs)
Reserves & Surplus
3000
Share Capital
Equity Dividend (%)
100
2000
50
1000
0
1
2
3
4
5
0
1
2
3
4
5
Debt Equity
Ratio
Close Price
0.81
0.86
0.87
0.35
0.63
3453.55 3287.35 3297.9 1854.75 2331.25
Interpretation:
As we can see here that in spite of there is increase in the Debt equity ratio there is a steady growth in the Market price of Rolta that is because
IT sector Doesn’t need any much investment and work on low investments also so, there is no much impact of Debt on the price in the market. Debt taken is signaled as good for the investors. And we can see there is variable dividend policy which also is not effecting the market price of rolta.
Polaris
Share Capital
49.78
Reserves & Surplus
Net Worth
49.75
49.76
49.6
49.48
1125.83 1037.89
979.2
867.51
730.6
1175.6 1087.64 1028.95
917.11
780.08
2500
Equity Dividend
(%)
125
Book Value (Rs)
100
100
90
70
118.09 109.3 103.47 92.45 78.83
300
250
2000
200
1500
Net Worth
Reserves & Surplus
Book Value (Rs)
150
Equity Dividend (%)
Share Capital
1000
100
500