IDEAS home Printed from https://ideas.repec.org/a/fej/articl/v3cy2011i1p3-13.html
   My bibliography  Save this article

Liquidity management efficiency of Indian Steel Companies (a Case Study)

Author

Listed:
  • Dr. Amalendu Bhunia

    (Reader in Commerce Fakir Chand College under University of Calcutta Diamond Harbour, West Bengal, India)

  • Islam Uddin Khan

    (Assistant Professor in Commerce Kaliyaganj College under University of Gour Banga Uttar Dinajpur, West Bengal, India)

Abstract

Liquidity management is of crucial importance in financial management decision. The optimalof liquidity management is could be achieve by company that manage the trade-off between profitability and liquidity management. The paper analyses the association between the liquidity management and profitability of 230 Indian private sector steel companies obtained from CMIE database. Liquidity management indicators and profitability indicator over the period from 2002 to 2010 are modeled as a linear regression system in multiple correlation and regression analysis. Evidence of petite association between those variables is found.A descriptive statistics discloses that liquidity and solvency position is very satisfactory and relatively efficient liquidity management is found. Multiple regression tests confirm a lower degree of association between the liquidity management and profitability.

Suggested Citation

  • Dr. Amalendu Bhunia & Islam Uddin Khan, 2011. "Liquidity management efficiency of Indian Steel Companies (a Case Study)," Far East Journal of Psychology and Business, Far East Research Centre, vol. 3(1), pages 3-13, June.
    • Handle: RePEc:fej:articl:v:3c:y:2011:i:1:p:3-13
    as

    Download full text from publisher

    File URL: http://www.fareastjournals.com/files/FEJPBV3N3P1.pdf
    Download Restriction: no
    File URL: http://www.fareastjournals.com/archive_detail.aspx?jid=18&aid=12
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Pradeep Singh, 2008. "Inventory and Working Capital Management: An Empirical Analysis," The IUP Journal of Accounting Research and Audit Practices, IUP Publications, vol. 0(2), pages 53-73, April.
    2. Pedro Juan García‐Teruel & Pedro Martínez‐Solano, 2007. "Effects of working capital management on SME profitability," International Journal of Managerial Finance, Emerald Group Publishing Limited, vol. 3(2), pages 164-177, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Samuel Kanga Odalo & George Achoki & Amos Njuguna, 2016. "Relating Company Size and Financial Performance in Agricultural Firms Listed in the Nairobi Securities Exchange in Kenya," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(9), pages 34-40, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amalendu Bhunia, 2011. "Short-Term Liquidity Management - A Study of Indian Steel Companies," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 2(4), pages 151-166, May.
    2. Nida Shah, 2016. "The Impact of Working Capital Management on Firms Profitability in Different Business Cycles: Evidence from Pakistan," Journal of Finance and Economics Research, Geist Science, Iqra University, Faculty of Business Administration, vol. 1(1), pages 58-70, March.
    3. Chauhan, Gaurav Singh, 2019. "Are working capital decisions truly short-term in nature?," Journal of Business Research, Elsevier, vol. 99(C), pages 238-253.
    4. Woei-Chyuan Wong & Sharmilawati Sabki & Angappan Regupathi & Syed Mohd. Na’im Syed Salim, 2019. "Malaysian SMEs’ Liability Structure and Its Impact on Profitability and Growth," Asian Academy of Management Journal of Accounting and Finance (AAMJAF), Penerbit Universiti Sains Malaysia, vol. 15(2), pages 77-94.
    5. Anokye M. ADAM & Edward QUANSAH & Seyram KAWOR, 2017. "Working Capital Management Policies And Returns Of Listed Manufacturing Firms In Ghana," Scientific Annals of Economics and Business (continues Analele Stiintifice), Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 64(2), pages 255-269, June.
    6. Eunhye (Olivia) Park & Woo-Hyuk Kim, 2021. "The effect of inventory turnover on financial performance in the US restaurant industry: The moderating role of exposure to commodity price risk," Tourism Economics, , vol. 27(7), pages 1417-1429, November.
    7. Muhammad Iqbal & Faisal Javed, 2017. "The Moderating Role of Corporate Governance on the Relationship between Capital Structure and Financial Performance: Evidence from Manufacturing Sector of Pakistan," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 6(1), pages 89-105, January.
    8. Hakan Özkaya & Şebnem Yaşar, 2023. "Working capital management in the food and beverage industry: Evidence from listed European companies," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 69(2), pages 78-88.
    9. Shahid Ali, 2011. "Working Capital Management and the Profitability of the Manufacturing Sector: A Case Study of Pakistan’s Textile Industry," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 16(2), pages 141-178, Jul-Dec.
    10. Abdul-Rahman Khokhar, 2019. "Working Capital Investment: A Comparative Study - Canada Versus the United States," Multinational Finance Journal, Multinational Finance Journal, vol. 23(1-2), pages 65-102, March - J.
    11. Paweł Mielcarz & Dmytro Osiichuk & Paweł Wnuczak, 2018. "Working Capital Management through the Business Cycle: Evidence from the Corporate Sector in Poland," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 12(2), June.
    12. Katerina Lyroudi & Sophia Nema, 2020. "The Effect of the Cash Conversion Cycle on the Z-scores of Fresh Milk Companies in Greece," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 1, pages 105-137, March.
    13. Brandenburg, Marcus, 2016. "Supply chain efficiency, value creation and the economic crisis – An empirical assessment of the European automotive industry 2002–2010," International Journal of Production Economics, Elsevier, vol. 171(P3), pages 321-335.
    14. Nguyen An Thanh Hong & Nguyen Tuan Van, 2018. "Working Capital Management and Corporate Profitability: Empirical Evidence from Vietnam," Foundations of Management, Sciendo, vol. 10(1), pages 195-206, September.
    15. Dalci, Ilhan & Ozyapici, Hasan, 2018. "Working capital management policy in health care: The effect of leverage," Health Policy, Elsevier, vol. 122(11), pages 1266-1272.
    16. Randa Mohammed Shams Addin Al-Mawsheki & Norzalina Binti Ahmad & Norhafiza Binti Nordin, 2019. "The Effects of Efficient Working Capital Management and Working Capital Policies on Firm Performance: Evidence from Malaysian Manufacturing Firms," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 9(3), pages 59-69, July.
    17. Ding, Sai & Guariglia, Alessandra & Knight, John, 2013. "Investment and financing constraints in China: Does working capital management make a difference?," Journal of Banking & Finance, Elsevier, vol. 37(5), pages 1490-1507.
    18. Olayinka Olufisayo Akinlo, 2012. "Effect of Working Capital on Profitability of Selected Quoted Firms in Nigeria," Global Business Review, International Management Institute, vol. 13(3), pages 367-381, October.
    19. Ashwin Madhou & Imad Moosa & Vikash Ramiah, 2015. "Working Capital as a Determinant of Corporate Profitability," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 18(04), pages 1-17, December.
    20. Burney, Robert B. & James, Hui Liang & Wang, Hongxia, 2021. "Working capital management and CEO age," Journal of Behavioral and Experimental Finance, Elsevier, vol. 30(C).

    More about this item

    Keywords

    Secondary data; multiple regression analysis; financial management; India; steel;
    All these keywords.

    JEL classification:

    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fej:articl:v:3c:y:2011:i:1:p:3-13. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jim Chau The email address of this maintainer does not seem to be valid anymore. Please ask Jim Chau to update the entry or send us the correct address (email available below). General contact details of provider: http://www.fareastjournals.com/journal_detail.aspx?jid=18 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.