Is better to take loan or raise equity for a manufacturing company

Question

Accepted Answer

It depends on the company's financial situation and goals.

If the company has a strong credit history and cash flow, a loan may be a better option as it allows the company to maintain ownership and control.
If the company is in a growth phase and needs more capital, raising equity may be a better option as it brings in new investors and can provide more flexibility in terms of repayment.
Ultimately, the decision should be based on the company's specific needs and goals.
For example, a company with a high debt-to-equity ratio may want to consider raising equity to reduce its debt burden and improve its financial position.

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