A framework for an optimized capital structure for state-owned natural monopolies

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dc.contributor.authorNxumalo, Khulekani Sydwell
dc.date.accessioned2017-10-03T07:31:36Z
dc.date.available2017-10-03T07:31:36Z
dc.date.issued2017
dc.descriptionResearch report submitted to partially fulfill the Master of Management in Finance and Investments to the Faculty of Commerce, Law and Management at the University of Witwatersrand March 2017en_ZA
dc.description.abstractThis study empirically examines whether the capital structure for natural monopolies (parastatals) dynamically responds to macroeconomic conditions. It further examines whether the balance sheet channel theory holds for this industry sample. The study adopts a double sampling approach from the population of water boards in South Africa (SA), which raise their capital in open financial markets. A quantitative research approach is adopted with a descriptive design to achieve relevant deductions. Panel techniques are used in the descriptive design for the regressions. The study finds that leverage partly dynamically responds to macroeconomic conditions. Furthermore, the evidence shows that inflation is an exception that has no significant relationship with leverage. The balance sheet channel theory is found to hold for water boards that access capital in open financial markets. Specifically, empirical evidence shows that changes in the interest rate have a delayed impact on the companies’ characteristics, including capital structure. Overall, our evidence suggests that water boards in SA need to consider the benefits of linking financial policies to the business cycle and that their policies should consider the delayed effect of interest rate changes.en_ZA
dc.description.librarianMT2017en_ZA
dc.format.extentOnline resource (54 leaves)
dc.identifier.citationNxumalo, Khulekani Sydwell (2017) A framework for an optimized capital structure for state-owned natural monopolies, University of the Witwatersrand, Johannesburg, <http://hdl.handle.net/10539/23211>
dc.identifier.urihttp://hdl.handle.net/10539/23211
dc.language.isoenen_ZA
dc.subject.lcshCapital--South Africa
dc.subject.lcshFinancial leverage--South Africa
dc.subject.lcshInterest rates--South Africa
dc.subject.lcshWater utilities--South Africa
dc.titleA framework for an optimized capital structure for state-owned natural monopoliesen_ZA
dc.typeThesisen_ZA
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