ALDO is contemplating the purchase of a new piece of equipment costing 1,60,00,000 (1.6 crores), and has three financing plans under consideration to finance the purchase:

Plan I: Raise the entire amount through equity

Plan II: Issue equity of Rs. 1 crore and raise the remaining through debt costing 13%

Plan III: Issue equity of Rs. 0.6 crores and raise the remaining through debt costing 20%.

ALDO can sell a share for Rs.100 each, and it is taxed at 25%. The EBIT after this new equipment is commissioned can be volatile, with the lowest EBIT expected to be Rs.16 lakhs, and the highest expected to be Rs. 32 lakhs. The most likely EBIT will be approximately Rs. 24 lakhs.

Using EBIT-EPS Analysis, which financing plan would you recommend to ALDO, and why?