IDEAS home Printed from https://ideas.repec.org/a/ids/injmfa/v2y2010i3p213-227.html
   My bibliography  Save this article

Sensitivity of profitability to working capital management: a study of Indian corporate hospitals

Author

Listed:
  • Mohammad Talha
  • S. Benjamin Christopher
  • A.L. Kamalavalli

Abstract

Working capital management almost always determines the ability of a firm to earn profit. Efficiency with which a firm handles working capital ensures prosperity while neglect would spell danger for the very survival of the firm. The study focuses on the impact of working capital management on profitability of selected Indian corporate hospitals. The time span is ten years from 1996 to 2006. The results of regression analysis point out that the current ratio, cash turnover ratio, proportion of current assets to operating income and leverage have a negative influence on profitability. Stepwise regression analysis has identified seven prominent variables that significantly influence profitability. Path analysis reveals that 'quick ratio' has the highest direct effect on profitability, while 'current ratio' has the least direct effect.

Suggested Citation

  • Mohammad Talha & S. Benjamin Christopher & A.L. Kamalavalli, 2010. "Sensitivity of profitability to working capital management: a study of Indian corporate hospitals," International Journal of Managerial and Financial Accounting, Inderscience Enterprises Ltd, vol. 2(3), pages 213-227.
    • Handle: RePEc:ids:injmfa:v:2:y:2010:i:3:p:213-227
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=34115
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

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


    Cited by:

    1. Sujan Chandra Paul & Md. Asiqur Rahman & Jiasmin, 2021. "Current Assets, Current Liabilities and Profitability: A Cross Industry Analysis," Journal of Asian Business Strategy, Asian Economic and Social Society, vol. 11(1), pages 55-68, June.
    2. Yakubu, Ibrahim Nandom & Alhassan, Mohammed Mubarik & Fuseini, Abdul-Aziz, 2017. "The Impact of Working Capital Management on Corporate Performance: Evidence from Listed Non-Financial Firms in Ghana," MPRA Paper 95113, University Library of Munich, Germany.
    3. Sari Viskari & Anita Ruokola & Miia Pirttilä & Timo Kärri, 2012. "Advanced model for working capital management: bridging theory and practice," International Journal of Applied Management Science, Inderscience Enterprises Ltd, vol. 4(1), pages 1-17.
    4. Rafal Siedlecki & Pawel Predkiewicz & Agnieszka Bem & Aleksandra Szpulak, 2021. "Working Capital Management in Hospitals: Evidence from Poland," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 1), pages 836-850.

    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:ids:injmfa:v:2:y:2010:i:3:p:213-227. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=252 .

    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.