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  3. km ltd. has the following capital structure on sep

KM Ltd. has the following capital structure on September 30, 2019: Sources of capital ()...

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Finance

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KM Ltd. has the following capital structure on September 30, 2019: Sources of capital () Equity Share Capital (40,00,000 Shares of * 10 each) 4,00,00,000 4,00,00,000 Reserves & Surplus 2,00,00,000 12% Preference Shares 6,00,00,000 9% Debentures 16,00,00,000 The market price of equity share is 60. It is expected that the company will pay next year a dividend of *6 per share, which will grow at 10% forever. Assume 40% income tax rate. You are required to COMPUTE weighted average cost of capital using market value weights

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