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प्रश्न
Varunica Ltd., a reputed truck manufacturing company, needs rupees twenty crores as additional capital to expand its business. Mr. Alind Jindal, the CEO of the company, wants to raise funds through equity. The Finance Manager, Mr. Nikhil Sachdeva, suggests that the existing shareholders be offered the privilege to subscribe to new issue of shares as per the terms and conditions of the company which was agreed by Mr. Alind Jindal.
Name the method through which the company decided to raise additional capital.
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उत्तर
The method through which the company decided to raise additional capital is 'Rights Issue'.
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संबंधित प्रश्न
Explain the following as factor affecting the requirements of fixed capital:
Scale of operations
Ramnath is into the business of assembling and selling of televisions. Recently he has adopted a new policy of purchasing the components on three months credit and selling the complete product in cash. Will it affect the requirement of working capital? Give reason in support of your answer.
How does working capital affect both the liquidity as well as profitability of a business?
What is meant by capital gearing ratio?
Companies with a higher growth potential are likely to
Higher working capital usually results in :
Current assets of a business firm should be financed through
______ refers to the decisions regarding where to invest so as to earn the highest possible returns on investment.
Read the following text and answer the following question on the basis of the same:
Mr. A. Bose is running a successful business. Mr. Bose is the owner of R. K. Cement Ltd. Mr. Bose decided to expand his business by acquiring a Steel Factory. This required an investment of Rs. 60 crores. To seek advice in this matter, he called his financial advisor Mr. T. Ghosh who advised him about the judicious mix of equity (40%) and Debt (60%). Employ more of cheaper debt may enhance the EPS. Mr. Ghosh also suggested him to take loan from a financial institution as the cost of raising funds from financial institutions is low. Though this will increase the financial risk but will also raise the return to equity shareholders. He also apprised him that issue of debt will not dilute the control of equity shareholders. At the same time, the interest on loan is a tax-deductible expense for computation of tax liability. After due deliberations with Mr. Ghosh, Mr. Bose decided to raise funds from a financial institution.
"Mr. T. Ghosh who advised him about the judicious mix of equity (40%) and Debt (60%)." The proportion of debt in the overall capital is called ______.
How long do fixed assets last?
What are decisions about investment in long-term assets called?
Through which sources must fixed capital be financed?
Which sources should never be used to finance fixed assets?
Which set of activities is covered by expenditure on fixed capital?
What does the risk of capital budgeting decisions affect?
What is the effect of a larger Scale of Operations on fixed capital?
How does Choice of Technique affect fixed capital requirement?
How does the Level of Collaboration affect each firm's fixed asset investment?
