ASIAN JOURNAL OF RESEARCH IN BANKING AND FINANCE

The study investigated the relationship of capital structure and turnover ratios on shareholders? returns of National Stock Exchange listed consumer goods firms in India during the sixteen year period from 1999 to 2014. Previous studies showed that there is a positive, negative or no relationship of capital structure and turnover on profitability. The present study used return on assets and return on equity as the measures of shareholders? returns. The results revealed that, consumer goods companies have higher return on equity and more stable return on asset, and the capital structure as well as turnover ratios influence shareholders? returns in a better way when it is measured as return on asset compared to return on equity. The study finds that there is insignificant impact of long term debt to Equity on shareholders? return. Debt equity ratio is said to have significant and negative impact on return on asset and return on equity. The study reveals that there is found to be positive impact of Long term debt to total assets on shareholders? returns, significant with return on asset and insignificant with return on equity. Moreover, significant and negative impact of total debt to total asset on shareholders? returns is observed. There is positive and significant influence of total assets turnover ratio on return on asset and on return on equity, it is negative and insignificant. Growth rate of total assets and size of the business positively and insignificantly influence both return on asset and return on equity. The study also finds that in case of consumer goods industry, the impact of inventory turnover ratio on return on asset is significant and negative and on return on equity, it is positive and insignificant. Receivables turnover ratio influences return on asset positively and insignificantly and return on equity positively and significantly. Total assets turnover ratio impacts return on asset positively and significantly and return on equity positively and insignificantly. There is positive and significant influence of working capital turnover ratio on return on asset and positive and insignificant impact on return on equity. The control variable debt equity ratio is found to have negative and significant influence on both measures of shareholders? returns. Another control variable, growth rate of total assets has positive and insignificant impact on both measures of shareholders? returns.