CAPITAL STRUCTURE ANALYSIS OF STATE LEVEL PUBLIC ENTERPRISES IN KERALA

Abstract

The public sector became a major instrument of planned economic development and was viewed as its prime mover in several countries including India. Public sector is a very comprehensive term encompassing a vast array of activities undertaken through public funding from resources raised mainly through fiscal efforts. In India public enterprises consists of central public enterprises and state level public enterprises. The major sources of financing of public enterprises are equity and debt financing. Generally, financing decisions are often referred as capital structure decisions. The objective of the study is first, to analyse capital structure of selected state level public enterprises with the help of selected ratios, second analyses the influence of capital structure on the over all operating result of the state level public enterprises and compare the impact of new economic policy in the financial health of the Modern Manufacturing Public Enterprises (MMPEs) of Kerala. The analysis reveals that the financial health of the modern manufacturing state level public enterprises in Kerala has improved after the implementation of the new economic policy.