Capital Structure

Capital Structure refers to the mix of various forms of financing that a company uses to fund its operations and growth. This usually includes debt, equity, and sometimes other financial instruments. The balance between debt and equity financing is crucial as it impacts the company's risk profile, cost of capital, and overall financial health. Proper management of capital structure allows companies to optimize their financial performance, achieve sustainable growth, and maximize shareholder value. Investors and analysts closely examine a company's capital structure to assess its stability and potential for future profitability. Understanding the intricacies of capital structure helps in making informed investment decisions and strategic business planning.