+1 862 207 3288 Raising: This is one of the primary activities in case of corporate finance. Managers of various institutions and companies always try and raise money from the cheapest resource possible. According to the pecking order theory, we have the following category of various avenues from where we can raise the money. They are priority-wise: debt; then comes preferred shares; and last comes equity.
Investing: Investing is not a play. Any wrong investment can create severe long-term impact over the company. Many companies have failed just because they invested their resources in wrong areas and then entirely messed up the entire organization framework. For example, say the company is in need for the money after 3 months, but seeing your cash in hand, you decide to invest the money for a lock-in period of 6 months. Consequently, you saw liquidity crunch, unable to meet working capital needs making it costlier for the company to raise expensive financing.
Distributing: This is the final activity in case of corporate financing. Companies often tend to misjudge when to pay out the profit earned and when to retain the money for further future growth. Companies also often send signal to market by initiating dividend payment seeking support from its shareholders to retain their ownership in the company and do not invest out from the firm.
