Impact of Debt on the Performance of the listed Firms in Oil and Gas Industry of Pakistan

Abstract

This study examines the determinants of capital structure in listed firms of Oil and gas industry of Pakistan. A total of five firms were taken for study from the period of 2005 to 2014. The study explains the relationship between dependant variable i.e. leverage and independent variables i.e. Asset tangibility, Profitability and Growth. Descriptive analysis, correlation and regression analysis was conducted on the data available to know the relationship of these variable in the Oil and Gas industry. The study concluded that the independent variables have a significant effect on debt. The study shows that profitability and growth are negatively correlated to financial leverage; whereas, tangibility is positively correlated to financial leverage.