This study examines the influence of capital structure on shareholder wealth in the Indian automotive industry, utilizing both linear and non-linear analytical models. The research analyzes financial parameters, such as Debt-to-Equity Ratio and Total Debt Ratio, of significant corporations in the NSE Nifty 50 index, including Tata Motors, Mahindra & Mahindra, and Maruti Suzuki. The analysis indicates that specific ratios have a notable adverse impact on shareholder wealth. Moderate levels of debt may potentially improve performance, however excessive debt likely to be detrimental. A cubic prediction model is employed to accurately reflect the complex, non-linear correlation between capital structure and shareholder wealth. This model identifies a critical threshold at which the influence of debt on performance undergoes a major change. The results highlight the need of maintaining a well-balanced capital structure to maximize shareholder value and offer significant insights for strategic financial management in the automobile industry. Further investigation is advised to examine these dynamics in other industries and economic environments.