Determinants of Capital Structure and Its Impact on the Debt Maturity of the Textile Industry of Bangladesh

Journal of Business and Economic Development, 2017; 2(1): 31-37

7 Pages Posted: 25 Jan 2017

See all articles by G. M. Wali Ullah

G. M. Wali Ullah

Independent University, Bangladesh (IUB)

Mohammad Uddin

Independent University, Bangladesh (IUB)

Mohammad Abdullah

Independent University, Bangladesh (IUB)

M. Nazmul Islam

University of Malaya, Asia Europe Institute (AEI)

Date Written: January 3, 2017

Abstract

Capital Structure is one of the most important and talked about issues in the field of finance. The fundamental components of capital structure are debt and equity of a company. Though different researchers provide different comment on the theory of capital structure, majority of theories and findings seem to contradict with each other in terms of developed and developing economy. Practitioners as well as researchers all over the world have identified that capital structure has impact on the firm performance and debt maturity. Research in capital structure is not adequate and require intense empirical work in Bangladesh. With that idea, objective of this study is to investigate the significance of determining factors of capital structure on debt maturity of the textile industry of Bangladesh. This article provided an analysis of various determining factors of capital structure and their significance on debt maturity. For this purpose, data of 19 DSE stock listed company for the time period of (2010-2015) 6 years were collected. Pooled data methodology has been used to find out the regression based on data collection. Findings of this data showed that age has significant relationship in case of all ratios considered under debt maturity. Growth opportunity was found as insignificant on the debt maturity. Profitability was found to have a significant relationship with total debt ratio (RTD) on the other hand converse relationship with Short term debt (RSD) and Long term debt ratio (RLD).

Keywords: Capital Structure, Leverage, Tangibility, Profitability, Ready-Made Garments, Textile

Suggested Citation

Ullah, G. M. Wali and Uddin, Mohammad and Abdullah, Mohammad and Islam, M. Nazmul, Determinants of Capital Structure and Its Impact on the Debt Maturity of the Textile Industry of Bangladesh (January 3, 2017). Journal of Business and Economic Development, 2017; 2(1): 31-37, Available at SSRN: https://ssrn.com/abstract=2903763

G. M. Wali Ullah

Independent University, Bangladesh (IUB) ( email )

Plot - 16, Block - B, Aftabuddin Ahmed Road
Bashundhara R/A
Dhaka, 1212
Bangladesh
+8801793-514567 (Phone)

Mohammad Uddin

Independent University, Bangladesh (IUB)

Plot 16 Block B, Aftabuddin Ahmed Road Bashundhara
Bashundhara R/A
Dhaka, 1229
Bangladesh

Mohammad Abdullah

Independent University, Bangladesh (IUB) ( email )

Plot - 16, Block - B, Aftabuddin Ahmed Road
Bashundhara R/A
Dhaka, 1212
Bangladesh

M. Nazmul Islam (Contact Author)

University of Malaya, Asia Europe Institute (AEI) ( email )

Malaysia

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