The Band of Investment is a finance and investment principle that refers to the weighted average of debt and equity rates used to estimate the cost of capital for a business or project.
Called-up share capital refers to the part of issued share capital that has been requested to be paid by the shareholders. This term is relevant when dealing with partly paid shares.
Capital gearing refers to the proportion of debt to equity in the capital structure of a company. It is a crucial indicator of financial stability and risk.
Capital structure refers to the balance between a company's assets and liabilities, the nature of its assets, and the composition of its borrowings. It is also commonly used in the context of a company's debt-equity ratio and the mix of debt classes in structured finance instruments.
An essential concept in accounting and finance that pertains to providing capital for a company, managing its capital structure, converting reserves into capital, and accounting for capital expenditures.
Fixed capital of a company which gives confidence to creditors for investing in the company by providing assurance of a stable capital base.
Cross-sectional analysis involves comparing the accounting ratios of one company with those of its peers to assess profitability, liquidity, and capital structure. This method helps in determining a company's performance relative to its competitors.
An E-Type Reorganization, also known as Recapitalization, is a type of corporate restructuring under the Internal Revenue Code that involves significant changes in the composition of a company's capital structure.
A comprehensive metric frequently used to measure the value of a business in its entirety, incorporating both equity and debt.
A financial metric that shows the ratio of a company's equity to its debt, providing insights into how a company finances its operations and growth.
Financial leverage refers to the use of debt in a firm's capital structure to amplify the returns on equity. It is an essential concept in corporate finance that can significantly impact a company's earnings and risk profile.
An in-depth analysis of financial statements to assess a business's performance and position, using ratios to evaluate profitability, solvency, working capital management, liquidity, and capital structure.
The financial structure of a company refers to the specific mixture of long-term debt and equity that it uses to finance its operations. Understanding financial structure is crucial for evaluating financial health and making strategic business decisions.
Gearing ratios, also known as leverage ratios, measure the relationship between a company's capital structure, particularly its debt and equity. These ratios are crucial for assessing a company's financial stability and risk level.
A leveraged company is a business that has debt in addition to equity in its capital structure. The term is often used to describe companies that are highly leveraged, typically industrial companies with more than one-third of their capitalization in the form of debt.
Net Assets represent the total assets of an organization minus its liabilities and are crucial for evaluating the financial position and stability of a company.
Learn about the 'Offer by Prospectus', a method of offering new shares or debentures to the public, including requirements, examples, FAQs, related terms, and further resources.
Preference shares, also known as preferred stock, are a class of ownership in a corporation that has a higher claim on assets and earnings than common stock.
A document that provides detailed information about a new issue of shares or debentures, inviting the public to invest. The prospectus must comply with regulatory requirements and be filed with the appropriate authority.
Voluntary reorganization by the stockholders themselves of a corporation facing financial difficulties; the voluntary restructuring of a corporation's debt and capital structure.
Recapitalization involves altering the mix of debt and equity financing in a company without changing the total amount of capital.
Releveraging refers to the process of increasing the level of debt in the capital structure of a business. This financial strategy is often used to enhance returns on equity by leveraging borrowed funds.
A thin corporation primarily uses loans from shareholders for its capital rather than equity investments to enjoy tax advantages. This can lead to tax challenges if debt-to-stock ratios surpass acceptable industry standards.
Total capitalization refers to the comprehensive capital structure of a company, including long-term debt and all forms of equity. It reflects the total amount of capital a company has raised through debt and equity instruments to fund its operations and growth.
The weighted average cost of capital (WACC) represents a firm's average cost of capital from all sources, including both equity and debt, weighted by their respective usage in the firm's capital structure.
Understanding the calculation and implication of WACC in managing a company's capital structure and assessing project feasibility.
