• Dr.Ch.Bhaskar

Capital structure is one of the important decisions in corporate finance as it influences financial risk, profitability, and shareholder returns. The present study examines the relationship between capital structure and financial performance of selected Indian companies during the period 2021–22 to 2025–26. The study is based on secondary data collected from company annual reports and reliable financial sources. Five selected Indian companies are analysed using the Debt-to-Equity Ratio (D/E) as a measure of capital structure and Return on Assets (ROA), Return on Equity (ROE), and Earnings per Share (EPS) as measures of financial performance. Descriptive statistics, trend analysis, and correlation analysis are used to analyse the data. The findings indicate considerable differences in the capital structure and financial performance of the selected companies. The correlation analysis shows a negative association between D/E Ratio and ROA and ROE, while the relationship between D/E Ratio and EPS is relatively weak. The study indicates that greater dependence on debt does not necessarily result in improved financial performance. Therefore, companies need to maintain an appropriate balance between debt and equity while considering their profitability, financial risk, business characteristics, and long-term objectives. The study provides useful insights for corporate managers and investors regarding the importance of effective capital structure management in improving sustainable financial performance.

Capital Structure, Corporate Finance, Debt-to-Equity Ratio, Financial Performance, Return on Assets, Return on Equity, Earnings per Share, Indian Companies.

"“Financial Leverage and Firm Performance: An Empirical Study of Selected Indian Companies”", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.13, Issue 10, page no.a707-a715, October-2026, Available :http://www.jetir.org/papers/JETIR2610076.pdf

"“Financial Leverage and Firm Performance: An Empirical Study of Selected Indian Companies”", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.13, Issue 10, page no. ppa707-a715, October-2026, Available at : http://www.jetir.org/papers/JETIR2610076.pdf