Here we have to consider one thing, It is correct in saying Equity is an expensive capital for a strong business like Suven. But we have to look at few points:
1) Interest payment will be an extra burden for them, because going forward the earnings will be lumpy (as already said by Venkata Jatti). Hence for a lumpy earnings projection, it is wise to stay out of debt.
2) The cost of future R&D are going to be huge and hence needs to be handled accordingly. Taking debt at Phase 2A, will only make financing difficult at later stages of the development where they actually needs lots of cash in hand.
| Subscribe To Our Free Newsletter |
