Determine the number of shares the company must issue

Reference no: EM132736783

Question: Kapingizgoli Limited is a company in the sportswear market. The average return in the sportswear market hovers around 18%. The average return on treasury bills is 7%. The annual returns of shares in Kapingizgoli Ltd have a standard deviation of 3.58% while the standard deviation of market returns is 2.72%. The correlation coefficient for returns on shares in Kapingizgoli and returns for the market as a whole is +0.85. Kapingizgoli Ltd has recently paid a dividend of K0.40 per share. The policy of the company has been to maintain a growth in dividends of 5% per annum. The company is considering issuing ordinary shares to raise K20,510,000 to invest in a new factory.

Required: Suggest the number of shares the company must issue in order to raise the required amount of funds.

Reference no: EM132736783

Questions Cloud

Examine journal entries required for each transaction : Happy Toy Inc. is a toy store that sells a wide selection of toys in Waterloo. You have been hired as the accountant and have been asked to prepare journal.

Implications of demographic forces be for food industry : What might some of the implications of demographic forces be for the food industry? What are the advantages and disadvantages of technological change?

Similarities and differences among generic strategies : 1. Describe the similarities and differences among generic strategies. Provide an example of an organization using a generic strategy.

Analyze competitive advantages : Pick any organization is familiar and analyze its competitive advantages. Being specific, how was it determines the type of advantage?

Determine the number of shares the company must issue : Kapingizgoli Limited is a company in the sportswear market. The average return in the sportswear market hovers around 18%. The average return on treasury bills.

Who pays the tax and how is calculated : Who pays the tax and how is it calculated? Are there any special considerations or challenges for the calculation of the payroll tax for the guides

What does a sample assortment plan look like : Shoppers Drugmart carries vitamins. What does a sample assortment plan look like? Include a minimum of 6 products.

Describe the inputs that produce good or service : • Identify and describe the good or service you have selected. Include the brand name.

Find what were merchandise purchases in november : Cost of Goods Sold was $333,787. Assuming that all merchandise purchases were on account, what were merchandise purchases in November?

User Account

All Pages