CAPITAL INVESTMENT

(MEANING AND
IMPORTANCE)

BY- ADESH (00213701718)

MEANING
 Capital investment is the procurement of money
by a company in order to further its business goals
and objectives. The term can also refer to a
company's acquisition of long-term assets such as
real estate, manufacturing plants and machinery
Examples of Capital Investment

 Software
 Branding
 Land & Buildings
 Landscaping

(Productive changes to land such as an irrigation system for a farm)

  The capital investment is done by every
business owner to own the assets that will be
required for the growth and survival of the
business. It involves
IMPORTANCE  Spending of funds for generating future
OF CAPITAL economic benefits,

INVESTMENT  Increase the efficiency of operations,

 Generate revenues at a large scale,

 And to acquire a large share in this

competitive market.
ADVANTAGES
• The main advantage of capital investment is the flow of economic benefit for several years
i.e., the same asset will be used over a long period of time to generate revenues for the
business. These are generally one-time investment but are being used for many years.
• It also helps in providing employment to the public as manpower will be required to operate
such heavy investments like plant & machinery. Therefore, Capital investment helps in
reducing unemployment.
• A good capital investment can provide a competitive advantage over the competitors as it can
help in providing better goods and services to the customers than the competitors.
CONCLUSION
 It involves expenditure on the assets that will be used for a longer duration. The choice of
capital investment should be done wisely as these investments require a large amount of funds.
But there are many sources from where the funds can be arranged apart from using owned
funds like equity and debt funding, a loan from financial institutions, etc.
THANK YOU