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OPTIMAL CAPITAL STRUCTURE AS A TOOL OF COMPANY COMPETITIVENESS
Abstract
In recent years a number of empirical studies have been focused on the capital structure and its optimization and have been mainly applied to a group of enterprises or to the industry. Empirical work in this area has lagged behind the theoretical research and for this reason we used statistical models to the data of a specific enterprise, in which we identified the key determinants of the capital structure. Nowadays there is no universal and uniquely reliable way how to optimize business capital. Therefore we use in the calculations several models that offer a different view on the capital structure, to ensure the multidimensionality and comparability when optimizing the capital structure. In our study we use the model, in which ROE is used as the optimization criterion, to calculate the optimal debt. Subsequently, we identify the optimal ratio of equity to assets and finally the recommended debt for the specific company is determined. The recommendation to minimize or maximize the proportion of equity to assets was realized by the optimization criterion, by EVA indicator (maximization test). Using the econometric model the relation between the determinants and capital structure expressed by total debt was determined. We expand the basic econometric model using the autocorrelation function and exponential smoothing by Holt - Winter.
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