Paper Details

The Purpose of this paper is to examine the impact of capital structure on firms’ performance using a dataset of Information technology Firms in India. This paper carries out a panel data analysis of 190 observations from 19 IT firms listed on the Bombay stock exchange over the period 2011-2020. Accounting performance is assessed through three different Performance measures: Return on assets (ROA), Return on equity (ROE) and Return on capital employed (ROCE). Study documents a significant and Positive impact of debt measures on performance. The result exhibit high debt ratio is beneficial for accounting performance of selected firms. Long term debt shows positive relation with performance. Therefore, it is suggested to IT firms to adopt long term debt to achieve higher performance. This study uses panel regression technique to analyse the data. The role of control variables is also established in this paper. Study contributes to the awareness by giving evidence to the policy makers that sample firms should discourage Short term debt in their capital structure. The findings of this research can help IT firms to improve their knowledge of financial management and use resources efficiently.

Capital structure, Information technology, Performance, Debt, Financing