maximizes the return for shareholders. It means maximum utilization of capital to the maximum extent that achieves greater profitability for the company with effective use of capital structure. The main objective of the company is to maximize the value of the business. This is done by minimizing the cost of capital and maximizing the value of the company's shares. The optimal capital structure is a ratio of equity to debt that satisfies the firm's objective. CHARACTERISTICS OF THE OPTIMAL CAPITAL STRUCTURE • The optimal capital structure is a debt-to-equity ratio made in such a way as to maximize the value of the company's equity stake. • Optimal capital structure maintains the financial stability of the organization. • The optimal capital structure considers the financial manager in which he determines the proportion of the debt capital capital structure such that the financial risk remains low or maintains the level of financial risk lower. • To obtain the optimal capital structure the leverage advantage given by corporate taxes is exploited