Abstract:
For a successful working of a business organization fixed and current assets
play a vital role as organization generally invests in these options. An attempt
has been made in this paper to study the working capital components and the
effect of working capital management policies on profitability of 10
Infrastructure companies. The paper also tries to study the correlation
between liquidity, profitability and Profit before Tax (PBT) of selected
Infrastructure companies. The study is based on secondary data collected
from annual reports of different Infrastructure companies and PROWESS
(CMIE Database) for the period 2007 to 2012. In this paper there is an
application of correlation and regression analysis to identify the significant
effects of Working capital management on the profitability. The Management
of operating capital is indispensable as it might induce a direct impact on
profitability and liquidity.
