what are the disadvantages of issuing debentures
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Payment of interest on debenture is compulsory and hence it becomes burden if the company suffer loss.
Debentures are issued to trade on equity but too much dependence on debentures increases the financial risk of the company.
Redemption of debenture involves a larger amount of cash outflow which is harmful for the company
During depression, the profit of the company goes on declining and it becomes difficult for the company to pay interest.
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