FACTORS AFFECTING
THE OPTIMIZATION OF A COMPANY’S CAPITAL STRUCTURE
The formation of capital sources and factors affecting the optimization of its structure are considered in the article. It is discovered that the optimal capital structure defines an effeciency level of operating activities of the company, its competitiveness, stable functioning and dynamic development. It is generalized that the formation of company’s capital is due internal and external sources of equity and loan capital. It is grounded that the company using only equity has highest financial stability (the autonomy ratio is equal to one), but thus limits its growth (it can’t provide the formation of the necessary additional volume of assets in periods of favorable market conditions) and can’t to use the financial opportunities of profit increase on invested capital. Instead, the company, which uses loan capital, has a higher financial potential of development (by forming additional volume of assets) and provides to the company increase of the market value of its capital. The dynamics of structure of equity and debt capital of domestic companies for types of economic activities during the 2013-2015 years is analyzed and it is found that the amount of equity and debt capital of entities mostly depends on their belonging to appropriate industry (the most capitalized are real industry, wholesale and retail trade, repair of motor vehicles and motorcycles). To avoid significant risks and improve the management decision-making in the company the most significant factors affecting the value of equity and debt capital of the company (sales stability, growth rate, assets structure, profitability, control in the company, taxes, operating structure, management attitudes, market conditions, prices etc.) are detailed. It is proved that the process of capital optimization should be not just towards the providing of the necessary volumes of financial resources to volumes of business needs, but also including the factors affecting the choice of structure, focused primarily on financial stability and profitability of the company.
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Keywords: financial resources, capital, equity, loan capital, affecting factors, capital structure, optimization of capital structure. |
CORPORATE FINANCE
Igor Khmarsky
student
SHEI «Kyiv National Economic University named after Vadym Hetman»
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