working capital
■ Indian Journal of Commerce & Management Studies
ISSN – 2229-5674
SHORT-TERM LIQUIDITY MANAGEMENT- A STUDY OF INDIAN
STEEL COMPANIES
Dr. Amalendu Bhunia
Affiliation: Reader in Commerce, Fakir Chand
College under C.U., Diamond Harbour, West
Bengal, India. bhunia.amalendu@gmail.com ABSTRACT
The overall efficiency is vital from the viewpoint of short-term liquidity and at the same time proper plane of profitability is required for the business enterprises. Consequently, the affiliation between short-term liquidity and profitability is one of the most imperative areas necessitating management analysis. In the present study, two private sector steel companies operating in India has been selected. For analysis, accounting ratios and statistical tools i.e., A.M., C.V., multiple correlation and regression has been used.
Keeping this in view, a study of managing liquidity of the selected private sector steel companies is undertaken in the present work.
Keywords: Secondary data, multiple regression analysis, financial management, Indian steel, performance.
■ Internationally Indexed Journal ■ www.scholarshub.net ■ Vol–II , Issue -4 May 2011 ■
151
■ Indian Journal of Commerce & Management Studies
ISSN – 2229-5674
Introduction:
Management of working capital has profitability and liquidity implications. That is why; working capital proposes a familiar front for profitability and short-term liquidity management. To reach optimal working capital management firm manager should control the trade off between profitability and short-term liquidity accurately. An optimal working capital management is expected to contribute positively to the creation of firm value.
The crucial part in managing working capital is required maintaining its liquidity in day-to-day operation to ensure its smooth running and meets its obligation (Eljelly, 2004). Liquidity plays a significant role in the successful functioning of a business firm. A firm should
ISSN – 2229-5674
SHORT-TERM LIQUIDITY MANAGEMENT- A STUDY OF INDIAN
STEEL COMPANIES
Dr. Amalendu Bhunia
Affiliation: Reader in Commerce, Fakir Chand
College under C.U., Diamond Harbour, West
Bengal, India. bhunia.amalendu@gmail.com ABSTRACT
The overall efficiency is vital from the viewpoint of short-term liquidity and at the same time proper plane of profitability is required for the business enterprises. Consequently, the affiliation between short-term liquidity and profitability is one of the most imperative areas necessitating management analysis. In the present study, two private sector steel companies operating in India has been selected. For analysis, accounting ratios and statistical tools i.e., A.M., C.V., multiple correlation and regression has been used.
Keeping this in view, a study of managing liquidity of the selected private sector steel companies is undertaken in the present work.
Keywords: Secondary data, multiple regression analysis, financial management, Indian steel, performance.
■ Internationally Indexed Journal ■ www.scholarshub.net ■ Vol–II , Issue -4 May 2011 ■
151
■ Indian Journal of Commerce & Management Studies
ISSN – 2229-5674
Introduction:
Management of working capital has profitability and liquidity implications. That is why; working capital proposes a familiar front for profitability and short-term liquidity management. To reach optimal working capital management firm manager should control the trade off between profitability and short-term liquidity accurately. An optimal working capital management is expected to contribute positively to the creation of firm value.
The crucial part in managing working capital is required maintaining its liquidity in day-to-day operation to ensure its smooth running and meets its obligation (Eljelly, 2004). Liquidity plays a significant role in the successful functioning of a business firm. A firm should
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