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Analyze the following case and answer the following questions. Case :UNITECH LTD. Has EQUITY Share Capital (Issued & Subscribed) of Rs. 10,00,000 (FV Rs. 100).
Analyze the following case and answer the following questions. Case :UNITECH LTD. Has EQUITY Share Capital (Issued & Subscribed) of Rs. 10,00,000 (FV Rs. 100). To meet the additional Financial Requirements of working Capital & Expansion, Company Board has passed a resolution to raise additional 600,000/- Rs. in next financial quarter. A) Full Money with Equity Shares issued at PAR- Only by way of EQUITY SHARES B) Rs. 3 Lakhs from Equity Shares & 3 Lakhs borrowings by NCD @10% INTEREST c) Full Fund Raising with Bank Loan @ 9% p.a. D) Rs. 2 Lakh from Equity Shares & 4 Lakhs from 8% Preference Shares Company Management is expecting Gross Earnings of Rs. 275,000 with Corporate Tax rate @ 25% 1.Do EBIT-EPS Analysis in Tabular Form with derivation of EPS for all 4 options 2.Advise to Company Management, which option from above - A-B-C-D is Best? 3. Explain with AFM reasons
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