A Study on the Capital Budgeting Practices: Evidences from Bhutan


  • Hita Nath Dhakal Author
  • Dr Rajnish Ratna Author
  • Budha Raj Kafley Author


Capital Budgeting, Profitability Index, RSEBL, DHI, risk assessment


This research aims at identifying the long-term investment decision practices prevailing amongst the Bhutanese firms. The capital budgeting tools and techniques used by the Bhutanese firms to evaluate new projects and then estimate their capital costs has been 
identified for this study. The data consists of listed companies under Royal Securities Exchange of Bhutan Limited and Druk Holding and Investment (DHI) owned companies.  It is clear from this study that RSEBL listed companies and DHI owned companies mostly 
prefer profitability index in capital budgeting decision-making in Bhutan. The findings from this study also reveals that, the project risk assessment tools such as scenario analysis and real options are the dominant approaches. There was no statically significant relationship between capital budgeting techniques employed by the RSEBL listed companies and the DHI owned companies. 


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