Company why should issue Debentures and shares,
Which one should issue better for company and why?
Answer Posted / rakesh
While deciding between shares and debentures the following
pionts needs attention-
1) Whether a company wants to dilute the existing ownership
or to increase the dedt.
2) The earning capacity of the company.
3) The rate of interest on bonds and the expected divident
payout.
4) Tenure-Long term(shares) or short term(debentures)
5) Reputation of the company.
All the above are some key points. The decision is
usually based on multi-attributes.
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