Essay Capital Structure of Titan Corporation – Appropriate Capital Structure – Business Assignment Help

Assignment Task :

Assignment Question 
1. Titan Corporation, is a very fast expanding and successful Furniture manufacturer and distribution company. Its Furniture products are mainly exported to the North America and European Countries. Titan Corporation was listed on the main board of stock exchange, and its share price is currently traded at 3.20 dollar per Share.
The share price of Titan Corporation for the past three(3) years, were swing at the range of 3.00 to 3.50 dollar per Share. The Board of Directors of Titan Corporation, are not very happy with the past performances of the Share price as they strongly believe as the market leader in the Furniture industry with strong brand name of its products, should be reflected at its Share price fairly, ideally be at the upside trend at the range of 3.80 to 4.00 per share.

The Board of Directors believes by following the right steps wealth maximization exercise in the long run, it should achieve the maximization of the market value of the company’s share.

Question:
i) You are required to argue whether you agree or disagree with the believe put forward by the Board of Directors of Titan Corporation, whereby the wealth maximization can be achieved over the long run by proper planning.
ii) You are required to argue what are the factors that really affect the performances of the Share price of company’s share listed on the stock exchange, such as Titan Corporation
iii) You are required to provide factors or approaches that could improve the performance of a company’s share price in the longer term, say from five to ten years after it was listed on the stock exchange.
 
2. The Board of Directors of Titan Corporation believe the right capital structure plays an important role in maximization the market value of its Share. However, the Board of Directors are not very certain what are the appropriate combination of capital structure that provide the maximum return in value to the company.

Question:
iv) You are required to explain what is meaning of capital structure, why is it important and how does it contribute or maximize the market value of its Share to the Shareholders?
v) You are required to explain what factors affect the capital structure of Titan Corporation.
vi) You are required to explain what are the approaches commonly used to measure the optimum value of a company, such as Titan Corporation.
vii) You are required to explain what are the good features of an appropriate capital structure.