Constructing Indices for Efficient Management of Working Capital in Indian Iron and Steel Sector
Downloads
Efficiency in managing the working capital is an integral part of the firm’s goal in maximising the market value. The paper analysed the efficiency of working capital management of companies engaged in the Sponge Iron producing sector in India. In order to test the efficiency, three indices are applied viz., Performance index, utilization index, efficiency index and OLS Regression model is used to measure the efficiency of working capital management. It is evident from the highly significant statistical test results prove the regression model is well fitted into the sample data.
Afza, T. and Nazir, M. S. (2011) ‘Working capital management efficiency of cement sector of Pakistan’, Journal of Economics and Behavioral Science, 2( 5), 223 – 235.
Azhagaiah Ramachandran and Muralidharan Janakiraman (2009) ‘The Relationship between Working Capital Management Efficiency and EBIT’, Managing Global Transitions, 7(1), 61-74.
Bhattacharya, H. (1997). Total Management by Ratios, New Delhi, Sage Publication India Pvt. Ltd.
Ghosh, S. and Maji, S. G. (2004) ‘Working capital management efficiency: A study on the Indian Cement Industry’, The Management Accountant, 39(5), 363-372.
FICCI, Steel Report, 2017
India Brand Equity Foundation Report, July 2017
Shehzad, F., Ahmed, K., Sehrish, S. and Yasir, M. (2012) ‘The relationship between working capital management efficiency and EBIT: Evidence from textile sector of Pakistan’, Interdisciplinary Journal of Contemporary Research in Business, 4(5), 211 – 225.
Rajeswara, Rao K. (1985) ‘Working Capital Planning and Control in Public Enterprises in India’, Ajantha Publications, Jaipur.
Sagan, J. (1955) ‘Towards a Theory of Working Capital Management’, The Journal of Finance, 10(2), 121–129.
Shin, H. H. and Soenen, L. (1998) ‘Efficiency of working capital management and corporate profitability’, Financial Practice and Education, 8, 37-45.
