Refer to the financial statements of Larsen and Toubro company for the past 5 years.

Calculate : a) The beta calculated by you then is the levered beta. From this beta calculate the unlevered beta. (3 m) b) Now consider different capital structures (Debt equity levels) for your company for all 5 years. Make use of this unlevered beta to calculate the levered beta, at each varied level of debt. Make use of this beta for calculating the cost of equity. Do this for all 5 years. (7 m)

c) Specify at which debt equity level the capital structure is optimum in your opinion. State your reasons for the same. (2 m) What difficulties would you anticipate in trying to implement any changes in your current capital structure? - (8 m)