A Study on Factors Influencing Capital Structure of Pharmaceutical Companies Listed on the Karachi Stock Exchange

This study focuses on investigating the factors influencing the capital structure of seven companies listed in the pharma and biotech sector of the Karachi Stock Exchange. Leverage has been designated as a representative of capital structure. Seven variables (all financial) are assumed independent and leverage has been taken as the dependent variable forming the basis for our pooled regression model. At an assumed 5% level of significance, three null hypotheses are rejected. Reliability tests namely Cronbach's Alpha measure is run in order to verify that the model is stable over time. The results of this test suggest inconsistency in the case of the entire range of the data but if considered individually the consistency, 5 out of 7 variables have positive alphas. However, the conclusions drawn from the model are tentative