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CHAPTER – II
REVIEW OF LITERATURE
In this chapter, the researcher collected studies which are related to
financial performance of sugar industries and other related industries both in
India and abroad. The review of literature supports to frame the
methodology and hypotheses of the present study. In this way the researcher
collects all the reviews and has arranged it according to year-wise
chronological order. Different authors have been analyzed for performance
in different perspectives. A review of these analyses is important in order to
develop an approach that can be employed in the context of the study of
sugar industry in Tamilnadu. Therefore, the present chapter reviews the
various approaches to the study of financial performance.
Mahalingam (1980)1 has conducted a study entitled ―Financial
Performance of Indian Sugar Industries‖ and has highlighted the theoretical,
as well as, practical advantages of operation of sugar mills. In this study he
has shown the actual benefits derived from the cooperative sugar mills. He
has pointed out that the benefits included rise in remuneration and the
consequent change in their cropping pattern, additional employment
opportunities and the development of their industries and business activities
in and around cooperative sugar mill.
Asha Jain (1981)2 has carried out a study on ―Price-Cost Margin in
Indian Manufacturing Industries : An econometric analysis‖ and examined
1 Mahalingam, S. ―Financial Performance of Indian sugar Industries‖, The Management
Accountant, Vol.15, No.4, Aprl. 1980, pp. 294. 2 Asha Jain, ―Price cost Margin, Indian manufacturing Industry An Econometric Analysis‖, Ph.D.
thesis, IIT, Kanpur, 1981.
21
the price cost margin over time in the Indian manufacturing industries. The
author has used price cost margin as a measure of profitability. Cost factors
have emerged as major determinants of profitability, while the structural
variables like concentration ratio, capital intensity have shown mixed
pattern. The author has observed different results for different industries.
Latha Arun Reddy (1983)3 has undertook a study entitled
―Profitability and Growth – Indian Manufacturing Industries‖ and has
examined the profitability of the Indian paper industry with reference to the
financial statistics of joint stock companies in India by the RBI. The prime
objective of the study has been to look at the relationship between growth
and profitability, using regression models and compound growth rates. The
author has observed that there has been a strong positive correlation between
growth and profitability in the paper industry.
Amin (1984)4 focuses on the cultivation of sugarcane by small
farmers in GorakhPur region. He has analysed the socio-economic and
cultural conditions, under which these small farmers have become dependent
upon traders, property owners and other intermediaries for marketing
sugarcane for the production of crystal sugar.
Kapadia (1985)5 has made a study to find out the contribution of
taken over units, in the poor financial surpluses earned by public sector
enterprises during 1978-83. He has found that taken over units accounted
for 18 per cent of total investment, 22 per cent of total sales turnover and 45 3 Latha Arun Retty, ―Profitability and Growth Indian Marketing Industries‖, Artha-Vikas, Vol.
XIX, No.1-2, Jan.-Dec. 1983, p.1. 4
Amen‘s., Sugarcane and Sugar in Gorakhpur: An Inquiry into peasant production for capitalist
Enterprises in Colonial India, Delhi, OUP, 1984, pp.xxii, 336. 5 Kapadia, M.S (1985). Public Sector‘s Poor Financial Returns: Place for Taken over Units,
Financial Express, No.7, p.5.
22
per cent of employment of all central government enterprises. He has found
that 48 taken over units are in red during the period of study amounting to
Rs. 936 crores. He has suggested measures for no-more takeovers of sick
industrial units just for the sake of protecting the employment, where it is
mostly non-viable to achieve the commercial results.
Kaveri (1985)6 has carried out a study on ―Financing of Working
Capital in Indian Industry‖. This review of working capital finance is based
on the Reserve Bank of India's studies on Finances of Large Public Limited
Companies, concluding that Indian industry has, by and large, failed to
change its pattern of working capital financing in keeping with the norm
suggested by the Chore Committee.
Rayudu (1985)7 in his article, ―Appraisal of Technical Performance
of sugar Industry A Case Study of Sectoral Analysis‖ has discussed the
crushing capacity, capacity utilization, hours of cane crushed, sugar and
molasses production efficiency, etc. On a comprehensive basis, the
comparison has been made between co-operative, pate and Government
sugar mills in Andhra Pradesh.
Sharma and Reddy (1985)8 has made a study on the liquidity
position of the Nizam Sugar Factories Limited during the years 1972-73 to
1981-82 and to identify the factors influencing the liquidity. The study has
concluded that the major element affecting the liquidity position of the firm
is government policy with respect to the input and output as well.
6 V. S. Kaveri ―Financing of Working Capital in Indian Industry‖ Economic and Political Weekly
Vol. 20, No. 35 (Aug. 31, 1985), PP. M123-M128. 7
C.S.Rayudu, ―Appraisal of Technical Performance of Sugar Industry – A Case study of sectoral
analysis‖, Indian Co-operative Review, New Delhi, Vol.xxxii, No.24, Oct-1985, P.134-137. 8 Sharma, S.N and Reddy, A.V (1985). Corporate Liquidity: A Case Study, The Management
Accountant, pp. 415-419.
23
Ram Vichar Sinha (1986)9 in his book ―Sugar Industry in India‖ has
concentrated on the economics of sugar mills in India. This book covers the
historical aspects of sugarcane, by-product utilization and labour relation in
sugar mills.
Rajendra Patil (1987)10
has studied the position of sugar Co-
operatives at Sri Panchaganga Co-operative Sugar Mill in Koihapur district
of Maharashtra. He concluded that the Panchaganga Co-operative Sugar
Mill acts as the appropriate agent for bringing about rural transformation.
Though there are adequate local resources of mobilization, implementation
of well-planned area development plans and various schemes of small
farmers. It is an apt example of how the gain from Co-operative enterprise
can have widespread benefits.
Thangavelu (1987)11
in his research work ―A study of the working of
paper industry with special reference to Sri. Venkatesa Paper and Boards
Ltd., Udumalpet‖, has analyzed the cost efficiency and financial
performance of Sri Vankatesa paper and board limited, Udumalpet from the
year 1977-78 to 1985-86. The relevant data are collected from the annual
reports of the company and are fitted to a regression model. He has
concluded that the co-efficient of output and raw materials is significant at 1
percent level. The study has also revealed that the cost has increased by 2.67
times, the profit ratio has shown a declining trend and the operating cost has
gone up ranging to 48 percent on sales throughout the period under study.
9
Ram Vichar Sinha; Sugar Industry in India, Deep and Deep Publication, New Delhi, 1986. 10
B.Rajendra Patil, ―Development of co-operative sugar factory and its social commitment,‖ Indian
cooperative review, NCUI, New Delhi, Vol. xxvi, No.1, July-1987, P. 111-119. 11
Thangavelu, ―A study of the working of paper industry with special reference to Sri Venkatesa
papers and Boards Ltd., Udumalpet‖, M.Phil. Dissertation submitted to Bharathiar University,
1987.
24
Khan (1988)12
has conducted a study on ―physical performance of
sugar industry in India since 1950-51 and has showed that a striking feature
of the sugar industry has been the instability in its output. The author has
also disclosed that the industry has faced regional imbalances in capacity
expansion and capacity requirements.
Pandey and Bhat (1988)13
have analyzed the financial ratios of the
Indian manufacturing industries, by taking 612 companies from 1965-66 to
1984-85. They have identified three groups of ratios, which contain the
maximum amount of information on profitability and have applied these
ratios to analyze only manufacturing and processing industries. The three
groups of financial ratios are returned on investment, sales efficiency and
equity intensiveness. There is a declining trend in profitability in relation to
sales, shareholders‘ equity and total investment. The three groups of ratios
show a declining trend across most of the firms.
Kulkarni (1989)14
in his article entitled ―Paper and Paper Board‖ has
noted that the paper industry is able to attain an abnormal rise in the capacity
and production for the last two decades, whereas, the rate of capacity
utilization declined very sharply. In 1971, the capacity and production of
paper and paper board units are 9.54 lakh tones and 7.75 lakh tones
respectively, representing a capacity utilization of 82.3 percent. In 1982, the
respective figures are 18.16 lakh tones and 12.06 lakh tones registering a
capacity utilization of 66.4 percent. For the year 1988, the capacity has
12
Khan. M.Y. ―Physical Performance of Sugar Industry in India Since 1950-51‖, RBI occasional
papers, 1988, pp.57-58. 13
Pandey, I.M and Bhat, R (1988). Financial Ratio Patterns in Indian Manufacturing Companies: A
Multivariate Analysis, Working Paper No. 764, August, Indian Institute of Management,
Ahmedabad 14
Kulkarni, A.V. ―Paper and Paper Board‖, No.1, Economic Times, August 1989, p.9.
25
raised to 28.51 lakh tones and the production is 17.20 lakh tones indicating
overall capacity utilization at 60.4 percent. The paper industry‘s installed
capacity is on the basis of 80 percent capacity utilization against the present
rational average capacity utilization of 65 percent.
―Modernization of Sugar Industry‖ is edited by Getaway J.K
(1990)15
and has been published by Arnold Publisher, New Delhi, is only a
compilation of papers presented by various authors. This book, consisting of
the papers presented by various authors‘, deals mainly with deficiencies of
the sugar industry in India and the modernization techniques to be adopted
to improve it. The author has argued the needs to expand the production
capacity of this industry and to develop the ancillary units to exploit the
wastes of sugar industry. In short, the author emphasizes the need for
diversification of sugar industry.
Swam B.N (1990)16
has studied cost benefit analysis of India‘s only
sugar beet plant in India. He has made an experiment on the beet sugar pilot
project at Gana Nagar, Rajasthan, and has given a wise idea to break the off-
season in Indian sugar industry.
Agarwal (1991)17
has undertaken a study on ―profitability and growth
in Indian Automobile manufacturing industry‖ and the study considers the
performance of the companies. The key objective of this study is to find out
whether the firms have been making abnormal profits when price controls
have been removed. The study is also aimed at evaluating the impact of
15
J.K.Gehawat (Editor), Modernization of sugar industry, Arnold publication, New Dethi, Bombay,
Bangalore, Calcutta and Madras, 1990 16
B.N.Swami, ―Cost Benefit analysis of India only Beet Sugar Plant‖, Journal of Management
Accountant, Vol. 28 (4), 1990, 134-140. 17
Agarwal R.N. ―Profitability and Growth in Indian Automobile manufacturing Industry‖, Indian
Economic Review, Vol.XXVI, No.1, 1991, pp. 81-97.
26
policy changes since 1981-82 on profitability and growth of firms in the
industry using Tobin‘s square as a measure of profitability and is found to be
primarily associated with vertical integration, diversification, age of the
firms, and industry policy. The study also reveals that the important
determinants of the growth of firms are expansion of capacities,
diversification, industry policy, dummy variables and gross retained profits.
The author has found evidence of abnormal profit, when price controls have
been removed.
Bhavani (1992)18
in her research work on ―performance of sugar
cooperative in Tamilnadu‖ has examined the physical performance, growth
and capacity utilization of sugar cooperatives in Tamilnadu, using ratio
analysis, regression analysis and compound growth rate. It has been
observed that the sugar production and said variables are positively
correlated and sugar recovery is not significantly correlated with sugar
production, number of factories and sugarcane crushed. The author has also
examined the physical performance of sugar factories in Tamilnadu, in terms
of sugarcane crushed, direction of crushing, sugar recovery and sugar
production. The author has observed that most of the cooperative sugar mills
in Tamilnadu are under utilized in some periods. The outcome of the study
has revealed that the efficiency of the selected nine cooperative sugar mills
assessed in terms of four indicators not uniform.
Gopalan M and K.Minfraj (1992)19
in their article on ―Financial
Management of Co-operative Sugar Mills‖ have dealt with certain issues for
18
Bhavani, S. ―Performance of sugar cooperative in Tamilnadu‖, unpublished M.Phil., dissertation,
Bharathiar University, Coimbatore, 1992. 19
M.Gopalan and K.Minfraj, Co-operatives, TCU, Chennai, Vol.78, April-1992, P. 412.
27
improving operational efficiency in financial affairs of Dharnapuri Co-
operative sugar Mill, This study is based on case study method.
Jagdish Lal (1992)20
in his article on ―Sugar and Sugarcane
Production Trends and Policies‖ has studied the production of sugar and its
consumption trend and has examined the impact of sugarcane and sugar
pricing and distribution policies. The study has shown that there is an
increasing trend in the case of production and consumption of sugar during
the period 1950-51 to 1990-91.
Chandra Sekaran (1993)21
has made a study on ―determinants of
profitability in sugar industry‖. The main aim of the study is to draw
inference on the impact of policy measures which has led to change in price
and distribution in the sugar industry. The determinants of profitability are
analyzed using the technique of least squares. In order to find out whether
the profitability function has shifted after the introduction of partial de-
control, dummy variable is introduced for estimating the function and the
test is also done to ascertain the inference. It is concluded from the study
that the profitability of the company is based on the assets structure and
proper utilization of the production capacity.
Venkaiah (1993)22
in his study entitled ―Management of Cooperative
Sugar Factories – A case study of Anakapalle cooperative Sugar Ltd.,
Thummapala‖, has analysed the operational efficiency and the capacity
20
Jagdish Lal, ―Sugar and Sugarcane Production, Trends and Policies‖, Indian Journal of
Agricultural Economics, Vol.47, No.3, 1992, pp.365-366. 21
Chandra Sekaran, N. ―Determinants of profitability in sugar industry‖, Decision, Vol.20, No.4,
Oct.-Dec.1993, pp. 235-244. 22
Venkaiah, V. ―Management of cooperative sugar factors : A case study of the Anakapalle Co-
operative Sugar Ltd., Tummapala‖, Role of Agriculture in Economic development, Deep & Deep
Publication, New Delhi, 1993, pp. 127-146.
28
utilization of the factory. He has observed that the financial performance of
this company has been unsatisfactory.
Thyagarajan (1994)23
in his article on ―Liberalization of Sugar
Industry in India‖ published in ―Kissan world‖ complaint the licensing
policy of the sugar mills and the control affected by the government on the
price fixation and problems faced by it.
An attempt has been made to study the ―Financial Performance of
Private Corporate Business Sector 1994-95‖ and the findings are published
in RBI Bulletin (1995)24
. The study covers 1030 companies in which 925
were non-financial companies and 105 are financial companies. The
consolidated results for the entire sector are analyzed in this study. The
results of the non-financial and financial companies are also analyzed size
wise on the basis of 1994-95 paid up capital of the companies. The study
revealed that the good corporate performance during 1994-95 has been
reflected in key profitability ratio which has shown distinct progress in the
year review as compared to the previous year.
Vijayakumar and Venkatachalam (1995)25
have carried out a study
entitled ―Profitability and Viability Working Capital and Profitability – an
empirical analysis‖ taking 13 firms from sugar industry, covering a period
from 1982-83 to 1991-92. The impact of working capital ratios on
profitability has been determined using correlation and regression analysis.
Major ratios like liquid ratio, receivables turnover ratio are computed to
23
R.V.Thyagarajan ―Liberalization of sugar Industry in India‖, Kisan world, Feb-1994 24
RBI Bulletin, ―Financial Performance Private Corporate Business Sector, 1991-95‖, Finance
India, Vol.IX, No.4, Dec.1995, pp.901-908. 25
Vijayakumar A and Venkatachalam A. ―Profitability and viability : working capital and
profitability – An empirical analysis‖, The management accountant, Vol.30, No.10, Oct.1995, pp.-
748-750.
29
measure their impact on profitability (PBT/TA). The study has shown that
inventory turnover ratio and receivable turnover have positive correlation
with the profitability and liquid ratio, whereas, cash turnover ratio negative
correlation with the profitability.
Boothalingam (1996)26
has studied the diversification and increased
efficiency in sugar production of co-operative sugar mills regarding the
usage of their by-products. Inclusion of value added activities by the co-
operative sugar mills have enabled to provide better return to their members,
he has added.
Manohar Rae (1996)27
in his article on ―Development of Indian
Sugar dustry Historical‖ has studied the origin of sugarcane and its
development. He has covered the area of cane production, utilization of
sugarcane, sugar licensing policy, quality of sugar, various development
schemes and suggestions offered by committees, sugar distribution, buffer
stock, international sugar trade etc.
Ravi (1996)28
has studied certain polices of sugar mills. This study is
based on policy, implication and strategies. The objective of this article is to
find out the major issues of the co-operative sugar mills in the changing
economic environment. He has examined the sugarcane pricing policy such
as statutory minimum price and state advisory price. He has also suggested
that the diversification is a key factor for improving the status of co-
26
M.Boothalingam, ―Diversification and increased Efficiency in sugar co-operatives,‖ Tamil Nadu
Journal of Co-operatives, TCU, Chennai, Vol. 28, No.6, Sep-1996, P. 314-346 27
P.J.Manohar Rao., ―Development of Indian Sugar Industry Historical‖ Indian Co-operative
review, NCUI, New Delhi, Vol. xxxii, No.7, March 1996, P. 152-160 28
D.Ravi, ―Development of co-operative sugar industry in policy implication and strategies,‘ co-
operative perspective, journal of co-operative management (Special journal) Pune, Vol. 30 and 31,
No. 4 and 1, January-March, April-June 1996, P.7-91
30
operative sugar mills, and it is one of the major solutions for overcoming the
present problems of co-operative sugar mills.
Saikumar and Raju (1996)29
in their articles have studied the role of
Co-operative sugar mills in India. They have found out that the average
crushing season and average recovery percentage of Co-operative sugar
mills are comparatively more against public and private sugar sectors and
they have found out the increase in the number of mills, which has resulted
in the increase of installed capacity. They have measured only the
operational efficiency of the co-operative sugar mills.
Pari and Divakar Naik (1997)30
have carried out a study entitled
―Trends in Area, Production and Productivity of Sugarcane in Orissa in
comparison with National and Global Level‖ and have analysed the inter
district trends in area, production and productivity of sugarcane in the state
of Orissa for the period 1973-74 to 1990-91 and have compared the same
with national and global levels. The study has reported a significant use in
area, production and productivity of sugarcane at the global level.
Pari and Vijayakumar (1997)31
have undertook a study entitled
―Productivity and Profitability of the Paper Industry : A case study of
Seshasayee Paper and Board Limited, Tamilnadu‖ and have analyzed the
productivity and profitability of the paper industry. The authors have
analysed the growth in production, sales and profit of Seshasayee paper and
29
G.V.S.Saikumar and S.N.Raju, ―Role of Co-operative Sector in Sugar Industry,‖ Indian co-
operative Review, NCUI, New Delhi, Vol. xxxiv, No.2, October-1996, P. 157-166 30
Pari K.C. and Dibakan Naik, ―Trends in Area, Production and Productivity of Sugarcane in Orissa
in comparison with national and Global Level‖, Agricultural situation in India, Vol.XXXXXII,
No.10, Jan.1997, pp.669-6730 31
Pari. C.A. and Vijayakumar, A. ―Productivity and Profitability of the paper Industry : A case study
of Seshasayee paper and Boards Ltd.,‖ Management and Labour Studies, Vol.22, No.2, Apl.1997,
pp.82-89.
31
Board limited for the period 1981-82 to 1993-94 and have found out the
factors that determines the profitability of the company. The regression
analysis has revealed that the debt to total assets ratio, inventory turnover
ratio, current ratio, operating expenditure ratio, capacity integration and
vertical integration are permanent variables in determining the profitability
of Seshasayee paper and board limited.
Sanjeev Kumar Malik (1997)32
in his article entitled ―Growth
analysis of Sugarcane in Haridwar District of Uttar Pradesh‖ has
investigated the growth rate of sugarcane crop in Hardwar District and has
visualized the effects of change in areas of cultivation as well as yield
potential. To study the growth rate, the exponential function is fitted by the
least square method. Haridwar district has made significant and positive
compound growth rate of sugarcane production per unit per year. He has
concluded that the growth rate of sugarcane production has found higher
than the area and yield growth. Moreover the increase in the production of
sugarcane has been mainly caused by the area effect along with the yield
effect.
Kawal Raj Dawar (1998)33
in his study in ―Determinants of
Profitability in Sugar Industry in Punjab and Haryana‖ has measured the
profitability of the individual mills on year-wise basis. The researcher has
employed time series and cross section data to calculate multiple regression.
The author has arrived at the conclusion that improvement in sugarcane
recovery and avoidance of abnormal expansion can go a long way in
improving profitability ratio in the sugar industry.
32
Sanjeev Kumar Malik, ―Growth Analysis of Sugarcane in Hardwar District of Uttar Pradesh‖,
Cooperative Sugar, Vol.28, No.6, Feb. 1997, pp.453-454. 33
Kawal Raj Dawar, ―Determinants of Profitability in the Sugar Industry in Punjab and Haryana : A
Sector wise Analysis‖, Indian Co-operative Review, April, 1998, pp. 325-331.
32
Narayanasamy and Ramachandran (1998)34
have concluded that
the sugar mills have to purchase sugarcane at the price advised by the state
government, which is substantially higher than the minimum price fixed by
central government, and should not have a free hand in the sale of sugar,
since the release of sugar being controlled by the Government. The prices of
input and output of sugar are decisive factors in determining the
development of co-operative sugar mills.
Vijayakumar (1998)35
in his article titled ―Determinants of Corporate
Size Growth and Profitability‖ has examined the determinants of corporate
size, growth and profitability of the Indian companies for the period
covering from 1980-81 to 1995-96. The statistical techniques, like average,
correlation and linear and multiple regression analysis have also been
employed in this study. The inter industry analysis has revealed that except
the textile industry, the growth has been positively and significantly
associated with the size with respect to all other industries. It has also
revealed that the growth has been found to be associated with profitability to
a considerable extent.
Chandrasekaran (1999)36
has carried out a study on ―Financial
Performance of Indian Sugar Industry‖ for the period covering from 1990-91
to 1995-96 in which various ratios, like profitability ratio, coverage ratio,
liquidity ratios and turnover ratios, have been calculated. It has been found
that financial performance of the sugar industry had been moderate to poor,
except during 1993-94. The study has disclosed that the financial
34
N.Narayanasamy and Ramachandran, ―Factors affecting the Growth and Development of
Cooperative sugar factory — A case study, ‗Indian co-operative Review, NCUI, New Delhi, Vol.
xxv, No3, Jan-1998, P. 242-253 35
Vijayakumar, A. ―Determinants of Corporate Size Growth and Profitability: The Indian
Experience‖, The Management Accountant, May, 1998, Vol.33, No.5, pp. 327-329. 36
Chandrasekaran, N. ―Financial Performance of Indian Sugar Industry‖, The Management
Accountant, Vol.34, No.4, April 1999, pp.293-298.
33
performance of sugar industry has been affected mainly by high stocks of
finished goods, average to low coverage ratios, due to high variability of
earnings, high leveraging and difficulty of controlling cost structure. The
author has concluded that tough cycle of low production, high price
realization, followed by higher production and low price realization leading
to delay in payments would affect the companies if there is no significant
improvement in the financials of industry.
Navaneethakannan (1999)37
in his study has analysed the
―Productivity of Sugar Industrial Units in Cuddalore District‖ and has found
that, in general, sugar industry has faced the problems (non availability of
sugarcane, adequate water facilities) from the production department and
(liquidity position) from the financial department and (strike, lock out, lay-
off) from the management. He has suggested, moreover, has planned rational
allocation of resources from various activities pertaining to the functioning
of the sugar industries.
Jain and Surendra S.Yadav (2000)38
have ―Current Assets
Management: A Comparative Study of India, Singapore and Thailand‖
stated that sound current assets management is considered to be the primary
goal of working capital management in a business organization. Each current
asset, such as cash, inventory and receivables, must be managed efficiently,
in order to maintain the liquidity of the firm, while not keeping too high a
level of any one of them.
37
V.Navaneethakannan, 1999 ―A study on Productivity of Sugar industrial Units in Cuddalore
District,‖ Unpublished M.Phil Thesis, Annamalai University. 38
P.K.Jain & Surendra S.Yadav, "Current Assets Management: A Comparative Study of India,
Singapore and Thailand", Vision, the Journal of business perspective, Vol. 4, N0.2, July-
December 2000, PP.5 & 10.
34
Rajeswasi (2000)39
has carried out a study on ―Liquidity Management
of Tamilnadu Sugar Corporation Ltd, Alangular - A Case Study‖. Data has
been collected from the annual reports of TANCEM for a period of five
years from 1993-94 to 1997-98 to analyze the liquidity position of
TANCEM. It has been concluded from the analysis that, the liquidity
position of TANCEM is not stable. It has been observed from the liquidity
ratios, that there has been too much of liquidity in the first two years of the
study period. It has been concluded that the liquidity management of
TANCEM is poor and not satisfactory, since a very high degree of liquidity
is also as bad as an idle asset and affects profitability.
Sarvanan (2001)40
has made ―A study on Working Capital
Management in Ten Selected Non-Banking Financial Companies‖. For this,
he has employed several statistical tools on different ratios to examine the
effective management of working capital. He has concluded that the sample
firms had placed more importance upon the liquidity aspect compared to that
of the profitability.
Shanmugam and Poornima (2001)41
have studied ―Working Capital
is Still Most Crucial‖. 28 medium and large scale spinning mills in
Coimbatore industrial area and have revealed that the effective working
capital is almost crucial in an organization‘s success. The study has revealed
that most of the industries depend on production plans in working capital
planning, leaving all norms aside. The budgetary control has been found to
be the widely applied criterion of working capital control. When the
researchers interviewed the CEOs of the sample companies, it has come out 39
Rajeswari, N. ―Liquidity Management of Tamilnadu Cement Corporation Ltd., Alangulam – A
Case study‖, The Management Accountant, Vol.35, No.5, May 2000, pp. 377-378. 40
Sarvanan, P., "A Study on working Capital Management in Non- banking Finance Companies",
Finance India, Vol. XV, No.3, September, 2001 PP. 987-994. 41
Shanmugam, R and Poornima, S (2001). ―Working Capital is Still Most Crucial‖, Indian
Management, April, pp.62-65.
35
that every CEO has spent majority of time on working capital management,
which in turn highlights the importance of working capital management.
Prasad (2001)42
conducted a research study on the ―Working Capital
Management in Paper Industry‖. His sample consisted of 21 paper mills
from large, medium and small scaled for a period of 10 years. He has
reported that the chief executives have properly recognized the role of
efficient use of working capital in liquidity and profitability, but in practice,
they cannot achieve it. The study has also revealed that 50% of the
executives have followed budgetary method in planning working capital and
working capital management has been efficient due to sub optimum
utilization of working capital.
Sathyamoorthi (2002)43
in his work ―Management of Working
Capital in Selected Co-operatives in Botswana‖ has attempted to ascertain
how the current assets are financed and also has attempted to discover the
relative importance of various current asset components. The study covers
four years data of select cooperative organizations in Botswana. The study
has revealed that the liquidity ratios played a vital role to evaluate the short-
term efficiency of the organization. The study has shown that the
cooperatives had low liquidity resulting in their week position to pay short-
term debts.
Vijayakumar (2002)44
has carried out a study entitled ―Assessment of
Corporate Liquidity – A Discriminate Analysis Approach‖ in which 5
42
R.Prasad (2001) ―Working Capital Management in Paper Industry‖, Finance India Vol.XV No.1,
pp. 185-188 43
Sathyamoorthi, C.R (2002). ―Management of Working Capital in Selected Co-operatives in
Botswana‖, Finance India, September, Vol.16, No. 3, pp.105-125. 44
Vijayakumar, A. ―Assessment of Corporate Liquidity – A discriminant Analysis Approach‖,
Research Studies in Commerce and Management, Classical Publishing Company, New Delhi,
2002, pp.180-191.
36
cooperative sugar mills and 5 private sector companies in Taminadu are
taken into consideration among the 14 cooperative sugar mills of 14 private
sector companies. Only those units which are established before 1984 and
having a crushing capacity of 2000 metric tonnes per day are selected for the
study. The discrimination analysis is employed to determine the combined
effects of the ratios. The author has concluded that the cooperative sector is
classified as poor risk in all the selected years on the basis of current and
liquid ratio. The author has further concluded that the same has become
good risk during the year 1986-87 and 1987-89 on the basis of
discriminating Z score. The study has revealed that the overall liquidity
position of the industry is satisfactory.
Vijayakumar (2002)45
in his work ―Determinants of Profitability – A
Firm Level study of the Sugar Industry of Tamilnadu‖ has made an attempt
to study the various determinants of profitability viz., growth rate of sales,
vertical integration and leverage. The study is concluded by computing
current ratio, operating expenses to sales ratio and inventory turnover ratio.
The author has employed econometric models to test various hypotheses
relating to profitability with other variables. It has been concluded that
efficiency in inventory management and current assets are important to
improve profitability.
Reddy and Sudarsana (2003)46
in their study on ―Financial
Performance of Paper Industry in Andhra Pradesh‖ have studied issues
relating to the financial performance of some selected paper mills in Andhra
Pradesh. Non-financial areas, such as production, marketing, personal and
45
Vijayakumar, A. ―Determinants of Profitability – A Firm level study of the Sugar Industry of
Tamilnadu‖, The Management Accountant, Vol.37, No.6, June 2002, pp.458-465. 46
Reddy and G. Sudarsana. ―Financial performance of paper industry in Andhra Pradesh‖ Finance
India 17. 3 (Sep 2003): PP. 1027-1033.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Reddy,+G+Sudarsana/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Reddy,+G+Sudarsana/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Finance+India/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Finance+India/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Finance+India/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Finance+India/$N?site=business&t:ac=224361288/130C59D16D8398ECFA9/96&t:cp=maintain/resultcitationblocks
37
research and development, are excluded. Objectives of the study are to
evaluate the financing methods and practices of sample paper mills, to
analyse the investment pattern and utilisation of fixed assets, to ascertain the
working capital condition, to review the profitability performance, and to
suggest measures to improve profitability. Primary data have been obtained
from respondents and unstructured interview held with the executives of
sample mills. The study concludes that the paper industry in Andhra Pradesh
needs the infusion of additional funds. Also needed are restructuring of
finances, modernisation of technology, use of assets efficiently, creation of
adequate depreciation provision, and optimising inventory investments.
Satyanarayana Chary and Venkateshwarlu (2003)47
have indicated
that ―Working Capital Analysis‖ can be regarded as the circulatory system
of any business. Management of working capital is complicated on account
of two important reasons, namely, fluctuating nature of its amounts, and the
need to maintain a proper balance between current assets and non-current
assets, in order to maximize profit. Shortage of working capital is a chronic
disease with the industrial sector in India. The importance of working capital
in an industry cannot be over-stressed, as it is one of the important causes of
success or failure of an industry. Whatever be the size of a business, working
capital is its life-blood.
Vijayakumar and Kadirvelu (2003)48
have undertaken ―A study on
Profitability and Size of the Firm in Indian Minerals and Metals Industry‖.
The study has focused to give a solution to the two contradictory suggestions
47
T.Satyanarayana Chary & V.Venkateshwarlu, "Working Capital Analysis" The Journal for
Practicing Managers, National Institute of Industrial Engineering, Mombai-400087-India, Vol.27,
No.3, July-Sep 2003, P.38. 48
Vijayakumar A. and Kadirvelu, S. ―Profitability and Size of the firm in Indian Minerals and
Metals Industry‖, The Management Accountant, Vol.38, No.11, Nov. 2003, pp.816-821.
38
viz., the larger firms earn a higher rate of return on its investment than the
smaller firms and the counter argument that size, breeds, inefficiency and
hence profitability may decline with size of firms. Hence, it has become
necessary to study the relationship between size and profitability of the
firms. The study is related that size was found to be significantly associated
with the profitability during the study period.
Chakraborty (2004)49
has argued ―Managing Corporate Liquidity
and Financial Flexibility: Different Approach‖ that the conventional method
of measuring liquidity would not be sufficient to cover the extended view of
liquidity and new framework has to be developed to cover the analysis of
amount and trend of internal cash flow, which has the better proposition to
focus on a firm‘s liquidity position. He has concluded that this was definitely
a better approach to measure liquidity over the conventional method of ratio
analysis.
Reddy and Patkar (2004)50
have studied ―Working Capital and
Liquidity Management in Factoring: A Comparative Study on SBI and
Canbank Factors‖ the size and components of liquidity management in
factoring companies. They have examined the correlation between liquidity
and profitability of factoring companies. They have concluded that the
sundry debtors and amount due to creditors are the major components of
current assets and current liabilities respectively and also these determined
the size of the working capital.
49
Chakraborty, P.K (2004). ―Managing Corporate Liquidity and Financial Flexibility: Different
Approach‖, The Management Accountant, Vol.39, No. 8, pp. 653-655. 50
Reddy, Y.V and Patkar, S.B (2004). ―Working Capital and Liquidity Management in Factoring: A
Comparative Study on SBI and Canbank Factors‖, The Management Accountant, Vol.39, No.5,
pp. 373-378.
39
Balakrishnan (2005)51
in his study ―Financial Performance of Public
Sector Petroleum Industry‖, has analysed the liquidity, solvency,
profitability to predict the financial position of the companies. He has
concluded that the petroleum industry is in a health position.
Namasivayin (2005)52
in his article, ―India Recognized as a Major
Sugar Exporter‖ has suggested that the lenders should come forward to
provide adequate cash credit limit to sugar industries. These measures may
enable them not only to fund buffer stock adequately, but also to minimize
the product loss by utilizing sophisticated information technologies.
Alagumani and Anjugam (2006)53
in their article have focused
―Sugar Policy and Area Allocation and Econometric Analysis‖ and has
revealed that from the beginning, sugar has been put under rigid control.
During mid sixties, it has transformed by imposing 70% levy to partial
control. From eighties, it has liberalized by improving the proportion of free
sale sugar. Increased production of sugar has made the government to
further improve the proportion of free sale sugar to 70% during 1999-2000.
Andy Duff and Venkatramani (2006)54
in their article ―Fortune
Smiles on India‘s Sugar Sector‖ have explored how the sector‘s fortunes had
changed and examined some key factors that would influence its
development and profitability in the years to come. Production in 2005-06
has rebounded powerfully following two seasons of low output. Attractive
51
Balakrishnan .H. ―Financial Performance of Public Sector Petroleum Industry‖, PhD, Thesis,
Bharathiar University. 52
N.Namasivayam. June 2005, ―India Recognized as a Major Sugar Exporter‖, Industrial Herald,
p.34. 53
T.Alagumam and M.Anjugam, Jan.2003 ―Sugar Policy and Area Allocation an Econometric
Analysis‖, Indian Economic Panorama, p.37. 54
Andy Dutt and Venkataraman, S. ―Fortune smiles on India‘s sugar Sector‖, International Sugar
Journal, Vol.108, No.1292, 2006, pp.415-424.
40
margins for sugar products, robust growth in domestic sugar consumption
and promising market developments for ethanol and cogeneration have
combined to generate a wave of investment in the sector. India‘s sugar
sector is clearly on a roll-yet it is not so long ago that the industry was has
been crisis. Among the other issues, consideration has been given to the
impact of some fairly radical ideas regarding sugar prices and marketing
management that has been recently proposed by the government.
Padmanabhan (2006)55
has suggested ―Production of sugar in India -
An Analytical Study‖ that the sugarcane is one of the most important
commercial crops of the country and the sugar industry occupies an
important place in the economy. Sugarcane crop provides raw material to
over 25 industries and sugar industry is one of the largest agro based
processing industries, responsible for socio-economic development of rural
masses and national economy of our country.
Thirunarayanasamy (2006)56
, in his study has analysed ―Co-
operative Sugar Mills in Tamilnadu- An analysis of Sickness and Revival
Measures‖, concluded that the sickness in cooperative sugar mills has been
found to increase year by year. It is reflected in Altman‘s Z Score. The
accumulated losses, Absolute technology, mismanagement in finance and
production factors are the important causes for sickness in the mills. The
deviation from HCL (High Level Commission) norms was due to the above-
mentioned factors, which clearly revealed the weak position of the mills.
The official has opinionated that there was little scope for reviving the sick
mills. However, for recovery from sickness, HCL norms in production and
55
T.M.Padmanabhan, ―Production of sugar in India — An analytical study‖, Southern Economist,
New Delhi, Jan-2006, P. 15-16 56
M.Thirunarayanasamy, December 2006, Co-operative Super Mills in Tami Nadu an Analysis of
Sickness and Revival Measures, Unpublished Ph.D Thesis, Annamalai University
41
related aspects have to be followed. The study has been concluded that better
management practices and strict implementation of HCL norms would
produce better results.
Bhagat and Dilip Jain (2007)57
in their study ―Indian Sugar Industry
– An overview‖ have discussed about the structure, size and influence of
Indian sugar industry on world sugar market and presented an overall view
of the sugar industry and its socio-economic impact. The paper highlighted
the Indian sugar industry scenario, technology issues, efficiency
improvement, by-product usage and environmental safeguards addressed by
the Indian sugar mills. The authors have also presented that the engineering
and institutional support is available for its sustainable growth.
Chockalingam and Thirunarayansamy (2007)58
in their article
―The Cooperative Sugar Mills in Tamilnadu‖ - An analysis of Sickness
Revival Measures found that the net worth to total assets and the working
capital to total assets are negative in all the mills, due to purchase tax, cess,
and Co-operative society‘s commission, which has increased the cost of
production and these mills did not work at their full capacity, due to
inadequate supply of sugarcane, lack of electricity and water. They have
asserted that mis-management and internal disputes are the other problems
faced by the co-operative sugar mills in Tamilnadu.
Dheenadhayalan and Devianabrasi (2007)59
have suggested
―Financial health of Co-operative Sugar Mills -A Case Study of NPKRR Co-
operative Sugar Mills Ltd‖ that the ―Z‖- score of the sample units remain 57
Bhagat, J.J. and Dilip Jain, ―Indian Industry – An Overview‖, International Sugar Journal,
Vol.109, No. 1304, Aug.2007, pp.505-509. 58
S.M.Chockalingam and M.Thirunarayanasamy, 2007, ―Co-operative sugar Mills in Tamil Nadu —
An analysis of sickness and revival measures, Indian Co-operative Review, pp.181-187. 59
Dr.V.Dheenadhayalan and Mrs.R.Devianabrasi, ―Financial health of Co-operative Sugar Mills —
A Case Study of NPKRR Co-operative Sugar Mills Ltd‖., New Dethi, January -2007, P. 192-197
42
below the grey area from 1997 to 2007, but in the year 2001-02, they are in
the ―Z‖- score -0.29. After 2001-02, the decrease in the score indicates that
the sample unit is not financially sound and healthy. The sample units need
to put in efforts to increase the score. This will help the sample unit to avoid
any damage to its liquidity and solvency positions, thereby avoiding
financial distress and bankruptcy.
Pandey (2007)60
has recommended ―Indian Sugar Industry - A Strong
Industrial Base for Rural India‖ that the Indian Sugar Industry, second
largest ago-based processing industry after the cotton tiles industry in the
country, have a lion‘s share in accelerating industrialization process and
bringing socio-economic changes in under developed rural areas. Sugar
industry covers around 7.5% of total rural population and provides
employment to five lakh rural people. About 4.5 crore farmers are engaged
in sugarcane cultivation in India. Sugar mills (co-operative, private, and
public) have been instrumental in initiating a number of entrepreneurial
activities in rural India. Indian sugar industry can be a global leader,
provided, that it comes out of the vicious cycle of shortage and surplus of
sugarcane, lower sugarcane yield, and lower sugar recovery, ever- increasing
production costs and mounting losses. It needs quality management at all
levels of activity to enhance productivity and production. Attention is
required on cost minimization and undertaking product by processing
activities.
Kannadhasan (2007)61
in his article entitled ―Measuring Financial
Health of a Public Limited Company Using ‗Z‘ Score Model-A Case Study‖
60
Dr.Pandey, ―Indian Sugar Industry — A Strong Industrial Base for Rural India‖ MPRA,
Dec.2007. 61
M. Kannadhasan ―Measuring Financial Health of a Public Limited Company Using ‗Z‘ Score
Model- A Case Study‖ The Management Accountant, June 2007, Vol.42, No.6, PP.469-473.
43
ascertained the financial health of Wendt (India) Limited company and its
consistency in financial performance for five financial years from 2001-02
to 2004-05. The research findings are that the company is maintaining good
financial performance throughout the study period.
Kannadhasan (2007)62
has made an attempt ―Measuring Financial
Health of a Public Limited Company using ‗Z‘- Score Model- A Case
Study‖ to have an insight into the examination of financial health of a watch
company in India. To evaluate the financial conditions and performance of a
company, the author has used Z- score model, which captures the predictive
viability of a company‘s financial health, by using a combination of
financial ratios that ultimately predicts a score, which can be used to
determine the financial health of a company. The study concludes that the
company‘s overall financial health was good.
Sam Luther (2007)63
has undertaken a study entitled ―Liquidity Risk
and Profitability Analysis : A case study of Madras Sugars Ltd‖ and has
highlighted how the company had achieved adequate liquidity, risk
minimization and profit maximization. The objectives of the study are to
measure and evaluate the liquidity position of MCL, to assess the correlation
between liquidity and profitability and to assess the trade-off between
profitability and risk for a period from 1994-98 to 2004-05. The relationship
between liquidity and profitability are measured by computing spearman‘s
rank correlation co-efficient. The author, by using t-test, has concluded that
there is a liner relationship between liquidity and profitability. It is also
concluded that the high degree of aggressive policy adopted by MCL has
made a negative impact on its profitability. 62
M.Kannadhasan, ―Measuring financial health of a public limited company using ‗Z‘- score model-
a case study‖, The Management Accountant, June-2007, p. 469-479 63
Sam Luther C.T. ―Liquidity Risk and Profitability Analysis – A case study of Madras Cements
Ltd‖, The Management Accountant, Vol.42, No.10, Oct. 2007, pp.784-789.
44
Singh (2007)64
has studied ―Sugar industry in Uttar Pradesh:
Efficiency still Honey the Key‖, the sugar industry is a major agro-based
industry of Uttar Pradesh where cropping pattern is largely subsistence-
oriented and sugarcane is one of the important cash crops. During 2001-02,
the state had 20.35 lath ha area under sugarcane out of the total 4403 lakhs
ha area under sugarcane in the country. The sugar industry has shown
considerable instability in the level of production because of
interdependence and inter-relationship between sugarcane, gur, khansari and
white sugar leading to fluctuations in the production of sugarcane, as well
as, sugar. These fluctuations have emanated from the presence of various
processing sectors and have the different government policies. Such
uncertainty of affairs is neither conducive to sound growth of the industry
nor to the growers. In view of this scenario, it felt necessary to carry out an
investigation, which can reveal the present state of sugar industry, in terms
of its efficiency in operations. The study has revealed that most of the mills
are in the efficiency range of 60-80 percent. Efficiency is higher in the
private sector (81%), followed by the public (73%) and co-operative (66%)
sectors. Though this study has advocated the continuation of partial
decontrol policy, it has urged the policy makers to streamline strategies that
promote stabilization of sugarcane economy and make the state, a credible
supplier of Sugar in the international market, benefiting growers, processors
and, in turn, consumers.
Somannavar (2007)65
in his article, states that ―Indian Sugar Industry
is Competitive‖. He concluded that the strong infrastructure build up, co-
ordination between the centre and state governments, dialogue between the
64
N.P.Singh (2007) ―Sugar industry in Uttar Pradesh: Efficiency still Honey the Key‖, Agricultural
Economic review, Year-2007, Vol. 20, Issue-I. 65
Dr. S.B. Somannavar, Feb.2007. Indian Sugar industry- is it competitive?, Financing Agriculture,
P.8
45
firm and the farm sector, future based R&D, government co-operative
sector, proper utilization of the by-products and able trade policy have been
the essentials to make the Indian sugar industry globally competitive.
Vishanani and Shah (2007)66
have studied the ―Impact of Working
Capital Management Policies on Corporate Performance – An empirical
study‖ of Indian consumer electronic industry by implementing simple
correlation and regression models. They have found that there is no
established relationship between liquidity and profitability for the industry as
a whole; but various companies of the industry depict different types of
relationship between liquidity and profitability. However, majority of the
companies revealed positive association between liquidity and profitability.
Appuhami and Ranjith (2008)67
in their study on ―The Impact of
Firms' Capital Expenditure on Working Capital Management: An. Empirical
Study across Industries in Thailand‖ have investigated the impact of firms'
capital expenditure on their working capital management. The authors have
used the data colleted from listed companies in the Thailand Stock
Exchange. The study has also found that the firms' operating cash flow,
which has been recognized as a control variable, has a significant
relationship with working capital management, which is consistent with
findings of previous similar researches. The findings enhance the knowledge
base of working capital management and will help companies manage
working capital efficiently in growing situations associated with capital
expenditure.
66
Vishnani, S., and Shah, B. K. ―Impact of Working Capital Management Policies on Corporate
Performance -an Empirical Study‖, Global Business Review, 2007, Vol. 8, No. 2, PP. 267- 281. 67
Appuhami and B A Ranjith ―The Impact of Firms' Capital Expenditure on Working Capital
Management: An. Empirical Study across Industries in Thailand‖ International Management
Review 4. 1 (2008): PP. 8-21.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Appuhami,+B+A+Ranjith/$N?site=business&t:ac=195578526/130C5ED65432AB70B17/38&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Appuhami,+B+A+Ranjith/$N?site=business&t:ac=195578526/130C5ED65432AB70B17/38&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/International+Management+Review/$N?site=business&t:ac=195578526/130C5ED65432AB70B17/38&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/International+Management+Review/$N?site=business&t:ac=195578526/130C5ED65432AB70B17/38&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/International+Management+Review/$N?site=business&t:ac=195578526/130C5ED65432AB70B17/38&t:cp=maintain/resultcitationblocks
46
Renugadevi and Anurada Rajendran (2008)68
in their article
entitled ―Financial Efficiency of Sugar Industry in Tamilnadu‖, have
analysed the financial position of the selective unit of sugar industry in
Tamilnadu. The study covers a period of six years from 1998-99 to 2003-04.
Ratios are calculated with the help of the data obtained from various
secondary sources. They have concluded that despite all difficulties, the
sugar industry has indeed very bright prospects, as there is abundant supply
of raw materials, labour and huge local market. The Government is bound to
continue on a long term basis partial control and dual pricing system so that
the interest of consumers on the one hand and that of industry on the other
are protected and reconciled.
Ramachandran and Janakiraman (2009)69
have found negative
―The Relationship Between EBIT and the Cash Conversion Cycle (CCC).
The study has revealed that operational EBIT‖ dictates how to manage the
working capital of the firm. Further, it has been as found that lower gross
EBIT was associated with an increase in the accounts payable days. Thus,
the study has concluded that less profitable firms wait longer to pay their
bills, taking advantage of credit period granted by their suppliers. While the
positive relationship between average receivable days and firms EBIT
suggested that less profitable firms will pursue a decrease of their accounts
receivable days in an attempt to reduce their cash gap in the CCC.
Gaur and Jighyasu (2010)70
in their study on ―Financial
Performance Measures of Business Group Companies: A Study of Indian
68
Dr (Mrs) V. Renugadevi and Mrs.Anurada Rajendran ―Financial Efficiency of Sugar Industry In
Tamilnadu‖, Organisational Management Vol.XXIV, No.2.July-Sept.2008, PP. 4 and10. 69
Ramachandran, Azhagaiah and Muralidharan Janakiraman, "The Relationship between Working
Capital Management Efficiency and EBIT" Managing Global Transitions,7(1), PP.61-74, 2009. 70
Gaur and Jighyasu (2010) ―Financial Performance Measures of Business Group Companies: A
Study of Indian Non-Metallic Mineral Products Industries‖ . IUP Journal of Business
Strategy 7. 4 (Dec 2010): PP. 45-53.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Gaur,+Jighyasu/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Gaur,+Jighyasu/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Business+Strategy/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Business+Strategy/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Business+Strategy/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Business+Strategy/$N?site=business&t:ac=822454209/130C570458A65B04795/7&t:cp=maintain/resultcitationblocks
47
Non-Metallic Mineral Products Industries‖ have focused on the financial
data of 57 business group companies of Indian nonmetallic mineral products
industries (sugar, glass, gems & jewellery, refractories, ceramic tiles,
abrasives and granite) over a time period of 10 years (1999-2008) and have
examined the firm's financial performance, using performance measures-
Operating Profit and Return On Net Worth (RONW), the Size (SIZE),
Leverage (LEV), Working Capital Ratio (WCR) and Age (AGE) of the firm
are included as determinants of firm performance. Non-metallic mineral
product category consists of important industries of the manufacturing sector
(which contributes almost 15% to the GDP) and 3-4% to the GDP. This
study tries to see the performance of business group firms in different
business cycles.
Pankaj, Agarwal and Sinha (2010)71
have conducted a study on
―Financial Performance of Microfinance Institutions of India A Cross-
Sectional Study‖ analyzed the financial performance of various
microfinance institutions operating in India. It assumes significance because,
it is imperative that these institutions be run efficiently, given the fact that
they are users of marginal and scarce capital and the intended beneficiaries
are the marginalized sections of society. MFIs must be able to sustain
themselves financially in order to continue pursuing their lofty objectives,
through good financial performance.
Raheman, Abdul; Qayyum, Abdul; Afza, Talat; Bodla and
Mahmood Ahmed (2010)72
have carried out a study on ―Sector-wise
71
Pankaj K., Agarwal and S.K. Sinha ―Financial Performance of Microfinance Institutions of India
A Cross-Sectional Study‖ Delhi Business Review, July - December 2010, Vol.11, No. 2. Volume
1, N. 1 December – 2010. 72
Raheman, Abdul; Qayyum, Abdul; Afza, Talat; Bodla and Mahmood Ahmed. ―Sector-wise Analysis of
Working capital Management and Firm Performance in Manufacturing Sector of Pakistan‖
Interdisciplinary Journal of Contemporary Research In Business 2.7 (Nov2010):PP.412-437.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raheman,+Abdul/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Qayyum,+Abdul/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Afza,+Talat/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Bodla,+Mahmood+Ahmed/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Bodla,+Mahmood+Ahmed/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Bodla,+Mahmood+Ahmed/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raheman,+Abdul/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Qayyum,+Abdul/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Afza,+Talat/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Bodla,+Mahmood+Ahmed/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=848642383/130C5ED65432AB70B17/2&t:cp=maintain/resultcitationblocks
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Analysis of Working capital Management and Firm Performance in
Manufacturing Sector of Pakistan‖. The present study empirically estimates
and compares sector-wise impact of working capital management on
performance of manufacturing firms in terms of collection policy, inventory
policy, payment policy, Cash Conversion Cycle and Net Trading Cycle,
using financial data for 204 firms listed on Karachi Stock Exchange
classified in 9 sectors during period 1998-2007. The results indicate that
there are variations in sectoral performance in terms of different measures of
working capital management. There is no consistent behavior of any of the
working capital management measure in all of the sectors. In some sectors,
some of the measures play their vital role in predicting the profitability while
not in others.
Rao, Chinta Venkateswara, Azhagaiah, Ramachandran; Rao and
Chandrasekhara, (2010)73
have conducted a study on ―Financial
Management Focus on Working Capital Utilization in the Indian Cotton
Textile Industry : Methodological Analysis‖ and have analyzed the trends
and patterns of efficiency of WC (WC) utilization in respect of size of firms
of cotton textile sector in India on the application of three indices viz.,
Performance Index (PI), Utilization Index (UI), and Efficiency Index (EI).
For the purpose of analysis, the selected firms are classified into three size
categories viz "Small", "Medium" and "Large", based on average assets size
over the study period. The study reveals that Linear Growth Rate (LGR) of
PI, UI and EI in respect of WC efficiency for small size firms is significant,
while that of for medium size firms, the trend of UI alone is significant. The
trend of PI, UI and EI for large size firms is insignificant. On the whole,
73
Rao, Chinta Venkateswara; Azhagaiah, Ramachandran; Rao and K.Chandrasekhara, ―Financial
Management Focus on Working Capital Utilization in the Indian Cotton Textile Industry:
Methodological Analysis‖ Journal of Financial Management & Analysis 23.2 (Jul-Dec 2010): PP.63-
84.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+Chinta+Venkateswara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+Chinta+Venkateswara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+K+Chandrasekhara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+K+Chandrasekhara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+K+Chandrasekhara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+Chinta+Venkateswara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Azhagaiah,+Ramachandran/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Rao,+K+Chandrasekhara,+PhD/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Journal+of+Financial+Management+$26+Analysis/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Journal+of+Financial+Management+$26+Analysis/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Journal+of+Financial+Management+$26+Analysis/$N?site=business&t:ac=861735009/130C5ED65432AB70B17/43&t:cp=maintain/resultcitationblocks
49
despite the positive growth in PI, the WCM efficiency of overall firms is
found to be not encouraging, because the constant factors are declining,
which shows that the fixed components of WC are more than the varying
components of the WC.
Singh, Fulbag; Mogla and Monika (2010)74
have conducted a study
on ―Profitability Analysis of Acquiring Companies‖ and have examined the
profitability of acquiring firms in the pre- and post-merger periods. The
sample consists of 153 listed merged companies. Five alternative measures
of profitability are employed to study the impact of mergers on the
profitability of acquiring firms. The results reveal that profitability declined
in 55% of companies, and only 29% of companies could improve their
profitability. DuPont analysis reveals that profitability declined due to poor
asset utilization. It suggests that managers should give due attention to
proper utilization of newly acquired assets. Acquisition of neither healthy
nor loss-incurring units contributed to the profitability of acquirers.
Ahmad, Hafiz Khalil; Raza, Ali; Amjad, Waqas; Akram, and
Muhammad (2011)75
have conducted a study on ―Financial Performance of
Non Banking Finance Companies in Pakistan‖ and have analyzed the
financial performance of those non-bank finance companies (NBFCs) which
are providing the services of investment advisory (IAS), asset management
(AMS), leasing and investment finance (IF) for last two years. Ratio analysis
method has been used to analyze the financial performance of non-bank
financial institutions. The study concludes that the financial performance of
NBFCs has been better in 2008 as compared to the overall decline in 2009 74
Singh, Fulbag; Mogla and Monika. ―Profitability Analysis of Acquiring Companies‖ IUP Journal
of Applied Finance 16. 5 (Jul 2010): PP. 72-83. 75
Ahmad, Hafiz Khalil; Raza, Ali; Amjad, Waqas; Akram, and Muhammad. ―Financial
Performance of Non Banking Finance Companies in Pakistan‖ Interdisciplinary Journal of
Contemporary Research In Business 2. 12 (Apr 2011): 732-744.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Singh,+Fulbag/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Mogla,+Monika/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Ahmad,+Hafiz+Khalil/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raza,+Ali/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Amjad,+Waqas/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Singh,+Fulbag/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Mogla,+Monika/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Applied+Finance/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Applied+Finance/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/IUP+Journal+of+Applied+Finance/$N?site=business&t:ac=742380929/130C5E558DB78523478/44&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Ahmad,+Hafiz+Khalil/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raza,+Ali/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Amjad,+Waqas/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876050665/130C570458A65B04795/6&t:cp=maintain/resultcitationblocks
50
caused by many factors. This study can be helpful for investors for sake of
knowledge and to take long term investment decisions.
Alam, Hassan Mobeen; Raza, Ali; Akram and Muhammad
(2011)76
have undertaken a study on ―Financial Performance of Leasing
Sector. The Case of Pakistan‖ has examined financial performance of
leasing companies since 2008 to 2010. Ratio analysis technique has been
used to evaluate financial performance of leasing companies. This study
concludes that, in 2010, the financial ratios are showing the positive change,
but there is a decline in financial performance of leasing companies in 2009
as compared to 2008.
Amalendu Bhunia, Sri Somnath Mukhuti and Sri Gautam Roy
Amalendu Bhunia (2011)77
have conducted a study on ―Financial
Performance Analysis-A Case Study‖ and have identified the financial
strengths and weaknesses of the Indian public sector pharmaceutical
enterprises, by properly establishing relationships between the items of the
balance sheet and profit and loss account. The study covers two public sector
drug and pharmaceutical enterprises listed on BSE. The study has been
undertaken for the period of twelve years from 1997-98 to 2008-09 and the
necessary data have been obtained from CMIE database. The liquidity
position is strong in case of both the selected companies, thereby reflecting
the ability of the companies to pay short-term obligations on due dates and
they relied more on external funds in terms of long-term borrowings, thereby
providing a lower degree of protection to the creditors. Financial stability of
76
Alam, Hassan Mobeen; Raza, Ali; Akram and Muhammad. ―Financial Performance of Leasing
Sector. The Case of Pakistan‖ Interdisciplinary Journal of Contemporary Research In
Business 2. 12 (Apr 2011): PP. 39-345. 77
Amalendu Bhunia, Sri Somnath Mukhuti and Sri Gautam Roy Amalendu Bhunia, ―Financial
Performance Analysis-A Case Study‖ Current Research Journal of Social Sciences 3(3): 269-275,
2011.
http://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Alam,+Hassan+Mobeen/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raza,+Ali/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Alam,+Hassan+Mobeen/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Raza,+Ali/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink:lateralsearch/sng/author/Akram,+Muhammad/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblockshttp://search.proquest.com/docview.lateralsearchlink_1:lateralsearch/sng/pubtitle/Interdisciplinary+Journal+of+Contemporary+Research+In+Business/$N?site=business&t:ac=876011083/130C570458A65B04795/9&t:cp=maintain/resultcitationblocks
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both the selected companies has showed a downward trend and consequently
the financial stability of selected pharmaceutical companies has been
decreasing at an intense rate. The study exclusively depends on the public
sectors published financial data and it does not compare with private sector
pharmaceutical enterprises. The study helps the investors to identify the
nature of Indian pharmaceutical industry and also help to take decision
regarding investment.
Gupta Anand (2011)78
in his study on ―Financial Performance of
Public Enterprises in India: A Case Study of Rashtriya Chemicals &
Fertilizers Limited‖ has looked at the financial performance of the largest
public enterprise in the fertilizer sector – Rashtriya Chemicals and Fertilizers
Limited (RCFL) – with a view to understand what ails it. The paper stresses
that RCFL has done poorly: its reported pre-tax profits as a percentage of
average networth have ranged between 2.5 and 10.2 since its incorporation
in 1978, which is substantially lower than the profitability norms set up by
Government of India‘s Fertilizer Industry Coordination Committee. The
paper asserts that a major factor responsible for this is RCFL‘s inefficiency
in the use of various inputs (e.g., feedstock, power).
Sharma and Satish Kumar (2011)79
in their article entitled ―Effect
of Working Capital Management on Firm Profitability Empirical Evidence
from India‖ have examined the effect of working capital on profitability of
Indian firms. They have collected data about a sample of 263 non-financial
78
Gupta Anand P. ―Financial Performance of Public Enterprises in India: A Case Study of
Rashtriya Chemicals & Fertilizers Limited‖ Paper provided by Indian Institute of Management
Ahmedabad, Research and Publication Department in its series IIMA Working Papers with
number WP1988-11-01_00846. 2011. 79
A.K. Sharma and Satish Kumar ―Effect of Working Capital Management on Firm Profitability
Empirical Evidence from India‖ Global Business Review February 2011 Vol. 12 No. 1,
PP. 159-173.
http://ideas.repec.org/s/iim/iimawp.html
52
BSE 500 firms listed on the Bombay Stock (BSE) from 2000 to 2008 and
have evaluated the data using OLS multiple regression. The findings of their
study significantly depart from the various international studies conducted in
different markets. The results reveal that working capital management and
profitability is positively correlated in Indian companies. The study further
reveals that inventory of number of days and number of days accounts
payable are negatively correlated with a firm‘s profitability, whereas number
of days accounts receivables and cash conversion period exhibit a positive
relationship with corporate profitability. The present study contributes to the
existing literature by examining the effect of working capital management
on profitability in the context of an emerging capital market, such as India.
Srivastava and Anubha (2011)80
have carried out ―A Study of
Working Capital Management of Hisar Project: Reliance Infrastructure
Limited, India‖ and have focused on various facets of working capital
management at RIL at its Engineering, Procurement and Construction (EPC)
division, which mainly deals in power projects. Financial analysis of the
company has also been carried out to know its creditworthiness. Working
capital management involves not only managing the different components of
the current assets, but also managing the current liabilities, or to be more
precise, financing the current assets. There are three main areas in working
capital management and the study focuses on receivables management, cash
management, and inventory management. RIL manages its receivable
accounts through ageing analysis and manages its cash through management
information system. Inventory management is made easier through the
process of high sea sales and sale in transit. An analysis with respect to the