Capital Structure for a Bolivian Company: A Case Study of Industrias Continental

簡易檢索 / 詳目顯示

回結果列表

研究生：	希門娜 Ximena Marcela Salazar Castillo
論文名稱：	Capital Structure for a Bolivian Company: A Case Study of Industrias Continental 公司資本結構之案例探討－以玻利維亞共和國Industrias Continental公司為例
指導教授：	鍾惠民 Prof. Huimin Chung 洪世章
口試委員:
學位類別：	碩士 Master
系所名稱：	科技管理學院 - 科技管理研究所 Institute of Technology Management
論文出版年：	2007
畢業學年度：	95
語文別：	英文
論文頁數：	86
中文關鍵詞：	capital structure 、Trade Off Model 、Pecking Order 、Financial Information 、Sensitivity Analysis
相關次數：	點閱：2 下載：0
分享至:	分享至facebook 分享至twitter

查詢本校圖書館目錄查詢臺灣博碩士論文知識加值系統勘誤回報

This thesis analyzes the optimal capital structure for a Bolivian company: Industrias Continental considering the new project of the firm. It starts describing the case study, background, current situation of the company and financial information in order to show an overall picture of the firm’s operations.

Two theories related to this topic are reviewed, the Trade-Off Model and the Pecking Order, however it is demonstrated that the case study can not apply them because the lack of real factors such as a perfect capital market. There are also other factors that are considered in order to analyze how Industrias Continental and the other four Bolivian companies determine their optimal capital structure; between these determinants are size, industry, financial risk, tax shield, cost of capital etc.

The last part of this thesis describes the project of the company which is to set up a new plant in a different city than where the current facility is. It also makes an analysis of three different scenarios and finally based on these results and the determinants, it gets to the optimal capital structure for Industrias Continental.

Keywords: Optimal Capital Structure, Trade-Off Model, Pecking Order, Theoretical Determinants, Financial Information, Sensitivity Analysis.

ABSTRACT…………………………………………………………………………..ii
ACKNOWLEDGMENT…………………………………………………………....iii
List of Tables ………………………………………………………………………viii
List of Figures ……………………………………………………………………….ix

CHAPTER 1.     INTRODUCTION …………………………………………………..1
1.1.    Industrias Continental Case Study …………………………………………...1
1.1.1.    Background of the Company ………………………………………….1
1.1.2.    Financial Statements …………………………………………………..4
1.1.3.    Financial Ratios ……………………………………………………….6
1.2.    Importance of the Work ……………………………………………………...8
1.3.    Problem Description ………………………………………………………….9
1.4.    Objectives …...………………………………………………………………11
1.4.1.    General Objective ……………………………………………………11
1.4.2.    Specific Objectives …………………………………………………..11

CHAPTER 2.     METHODOLOGY ………………………………………………...12
2.1.    Research Strategy …………………………………………………………...12
2.2.    Thesis Structure ……………………………………………………………..12
2.2.1.    General Overview ……………………………………………………12
2.2.2.    Procedure Description ……………………………………………….14
2.3.    Data …………………………………………………………………………15
2.4.    Expected Results ……………………………………………………………16

CHAPTER 3.    THEORETICAL FRAMEWORK ………………………………..17
3.1.    Raising Capital Methods ……………………………………………………17
3.2.    Capital Structure theories …………………………………………………...18
3.2.1.    Modigliani and Miller's Theory ……………………………………...18
3.2.2.    The Trade-Off Model ………………………………………………..18
3.2.2.1.    Financial Distress ………………………………………………..20
3.2.2.2.    Agency Costs ……………………………………………………20
3.2.3.    The MM Vs the Trade-Off Theory …………………………………..20
3.2.4.    Pecking Order Model ……………………………………………..…21
3.2.5.    The Trade-Off Theory Vs The Pecking Order ………………………21
3.3.    Capital Structure Determinants ……………………………………………..23
3.3.1.    Industry ……………………………………………………………....24
3.3.2.    Size ………………………………………………………………......24
3.3.3.    Business Risk ………………………………………………………..25
3.3.4.    Financial Risk …………………………………………......................25
3.3.4.1.    Leverage …………………………………………........................25
3.3.4.2.    Debt ratio ……………………………………………...................26
3.3.5.    Tax Shield …………………………………………............................27
3.3.6.    Assets Tangibility …………………………………………………....27
3.3.7.    Growth Opportunity …………………………………………............28
3.3.8.    Earnings Variability …………………………………………............28
3.3.9.    Profitability …………………………………………..........................28
3.3.10.    Financial Flexibility …………………………………………………29
3.3.11.    Management Behavior …………………………………………........29
3.3.12.    Cost of Capital …………………………………………………….....29

CHAPTER 4.    MANUFACTURING INDUSTRY ………………………………..31
4.1.    Overview of the Manufacturing Industry ………………………………..…31
4.2.    Manufacturing Industry and Financial Institutions …………………………33
4.3.    Manufacturing Industry and Financial Markets …………………………….34
4.3.1.    Factors to be considered by the Stock Exchange ……………………36
4.3.2.    How to attract Investors ……………………………………………..36
4.3.3.    Debt Vs Equity ……………………………………………………....37
4.4.    Manufacturing Industry Description ………………………………………..39
4.4.1.    Industry ……………………………………………………………....40
4.4.2.    Size ……………………………………………………......................40
4.4.3.    Business Risk ………………………………………………………..41
4.4.4.    Financial Risk ………………………………………………………..41
4.4.4.1.     Debt Ratio ……………………………………………………....42
4.4.4.2.    Debt to Equity Ratio ……………………………………………..42

4.4.5.    Tax Shields ………………………………………………………......43
4.4.6.    Assets Tangibility …………………………………………………....43
4.4.7.    Growth Opportunity ………………………………………………....43
4.4.8.    Earnings Variability ………………………………………………....43
4.4.9.    Financial Flexibility ………………………………………………....44
4.4.10.    Management Behavior ……………………………………………....44
4.4.11.    Cost of Capital ……………………………………………………....45
4.5.    Analysis ……………………………………………………………………..45

CHAPTER 5.    INDUSTRIAS CONTINENTAL CASE STUDY ANALYSIS ……46
5.1.    Introduction ………………………………………………………………....46
5.2.    Analysis of the Capital Structure Determinants ………………………….…47
5.2.1.    Theoretical Models ………………………………………….…….…47
5.2.2.    Industry ………………………………………….………………...…48
5.2.3.    Size ………………………………………….…………………….…49
5.2.4.    Business Risk ………………………………………….………….…49
5.2.5.    Financial Risk ………………………………………….………….…50
5.2.5.1.    Debt Ratio ………………………………………….………….…50
5.2.5.2.    Interest Coverage …………………………….…….………….…50
5.2.6.    Tax Shield ……………………………………….………………...…50
5.2.7.    Assets Tangibility ……………………………………….………...…51
5.2.8.    Growth Opportunities ……………………………………….…….…51
5.2.9.    Earnings Variability ……………………………………….……...…51
5.2.10.    Profitability ……………………………………….…………………52
5.2.11.    Financial Flexibility ……………………………………….……...…52
5.2.12.    Management Behavior ……………………………………….…...…52
5.2.13.    Cost of Capital ……………………………………….………………52
5.3.    Project's Description ……………………………………….……………..…53
5.3.1.    Sales Forecasting ……………………………………….……………53
5.3.2.    Project's Costs ……………………………………….………...….…54
5.3.2.1.    Raw Materials ……………………………………….………..…54
5.3.2.2.    Personnel ……………………………………….……………..…55
5.3.2.3.    Machinery & Depreciation ………………………………………56

5.3.2.4.    Costs of Goods ……………………………………….……….…57
5.4.    Sensibility Analysis ……………………………………….…………..….…57
5.4.1.    Financial Institution ……………………………………….…………59
5.4.1.1.    Income Statement Considering a Bank Loan ……………………59
5.4.1.2.    Balance Sheet Considering a Bank Loan ………………………..60
5.4.1.3.    Cash Flow Considering a Bank Loan ……………………………60
5.4.2.    Financial Market ……………………………………………………..65
5.4.2.1.    Income Statement Considering Bonds …………………………..65
5.4.2.2.    Balance Sheet Considering Bonds ………………………………66
5.4.2.3.    Cash Flow Considering Bonds …………………………………..66
5.4.3.    Financial Institutions and Financial Market …………………………71
5.4.3.1.    Income Statement Considering Bonds & Loan ………………….71
5.4.3.2.    Balance Sheet Considering Bonds & Loan ……………………...73
5.4.3.3.    Cash Flow Considering Bonds & Loan ………………………….73
5.5.    Optimal Capital Structure ………………………………………………..…78

CHAPTER 6.    CONCLUSIONS ……………………………………………………81
REFERENCES ……………………………………………………………………..83
APPENDIX 1 ……………………………………………………………………….84
APPENDIX 2 ……………………………………………………………………….86














List of Tables

Table 1.  “Industrias Continental” Product’s Description ……………………………3
Table 2. Income Statements …………………………………………………………..4
Table 3. Past Balance Sheets …………………………………………………………5
Table 4. Trade Off Model VS Pecking Order ……………………………………….22
Table 5. Leverage Debt vs Equity …………………………………………………...26
Table 6. Bolivian Economical Indicators ……………………………………………32
Table 7. Continental Sales Forecasting ……………………………………………...54
Table 8. Raw Materials for One Container ………………………………………….54
Table 9. Staff from 2008 to 2010 ……………………………………………………55
Table 10. Staff from 2011 to 2012 ………………………………………………..…55
Table 11. New Machinery Cost ……………………………………………………...56
Table 12. Current Machinery Cost ………………………………………………..…56
Table 13. Cost of Goods ……………………………………………………………..57
Table 14. Financial Debt …………………………………………………………….59
Table 15. Income Statement Considering a Bank Loan ……………………………..61
Table 16. Balance Sheet Considering a Bank Loan …………………………………62
Table 17. Cash flow considering a bank loan ……………………………………….64
Table 18. Present Value of a New Debt …………………………………………….65
Table 19. Coupons and Face Value Payment ……………………………………….65
Table 20. Income Statement Considering Bonds ……………………………………67
Table 21. Balance Sheet Considering Bonds ………………………………………..68
Table 22. Cash flows Considering Bonds …………………………………………...70
Table 23. Capital & Interests to the Bank …………………………………………..72
Table 24. Present Value Coupons …………………………………………………..72
Table 25.Bank Loan and Bonds payments ………………………………………….73
Table 26. Income Statement Considering a Bank Loan & Bonds …………………..74
Table 27. Balance Sheet Considering a Bank Loan & Bonds ……………………….75
Table 28. Cash Flow Considering a Bank Loan & Bonds …………………………..77
Table 29. Summary of the Three Scenarios …………………………………………78


List of Figures

Figure 1. Financial Leverage Ratios …………………………………………………..8
Figure 2. Thesis Overview …………………………………………………………..13
Figure 3. Trade Off Model …………………………………………………………..19
Figure 4. Paint Companies Market Share …………………………………………....46
Figure 5. Sensitivity Analysis Flow Chart ………………………………………..…58
Figure 6. Financial Ratios …………………………………………………………...80

                                

Bodie, Kane, Marcus: Investments. 6th Edition. McGrawHill. Singapre. 2005

Brealy, Myers, Allen: Principles of Corporate Finance, 8th Edition, McGrawHill. Singapre. 2006.

Hilton Ronald W. Managerial Accounting, 6th Edition, McGrawHill. New York. 2005

Ian, Giddy: Case Study: SAP A.G. Finding a Company’s WACC and the Optimal Capital Structure, New York University, New York.

Ross, Westerfield, Jaffe: Fundamentals of Corporate Finance, 5th Edition, McGrawHill. Mexico. 2000

Ross, Westerfield, Jaffe: Essentials of Corporate Finance, 4th Edition, McGrawHill. New York. 2004

Ross, Westerfield, Jaffe: Corporate Finance, 7th Edition, McGrawHill. Singapore.2005

W.Carl Kester, Richard S. Riback, Peter Tufano: Case Problems in Finance, 12th Edition, McGrawHill. Singapore. 2005

全文公開日期本全文未授權公開 (校內網路)
全文公開日期本全文未授權公開 (校外網路)
全文公開日期本全文未授權公開 (國家圖書館：臺灣博碩士論文系統)

簡易檢索 / 詳目顯示

相關論文