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Impact of Working Capital Practices on Profitability of Indian Corporate Giants in New Millennium: An Exemplification of Reliance Industries Limited

Year 2012
Volume/Issue/Review Month Vol. - V | Issue II | July
Title Impact of Working Capital Practices on Profitability of Indian Corporate Giants in New Millennium: An Exemplification of Reliance Industries Limited
Authors Dr. Manish Sitlani
Broad area Impact of Working Capital Practices on Profitability of Indian Corporate Giants in New Millennium: An Exemplification of Reliance Industries Limited
Abstract
Financial decisions of corporate firms are a widely researched dimension of
corporate finance. Working capital decisions construes an important part of
corporate financial decisions, though basic focus of researchers had been
financing and investing decisions, as these two categories of financial decisions
are assumed to directly affect the profitability of firms. Nonetheless, working
capital decisions have their own role to play in corporate profitability, though
indirectly. For the corporate firms in developing countries like India, the relevance
of these decisions have greatly increased in recent times as the impact
of liberalization and privatization policies has started getting reflected through
various dimensions of corporate performance. Various studies have explored
that profitability of corporate firms is also affected by working capital practices
of these firms. But is the story same in new millennium? Exemplifying Reliance
Industries Limited, one of the largest firms in Indian corporate sector, this
research work attempts to explore the impact of working capital management
on profitability of private corporate firms in India with the help of regression
analysis.
Description Working Capital Management is one of the important aspects of financial decisions of a corporate firm. Management of short-term assets and liabilities, technically termed as working capital management, is extremely crucial for the survival of the firm as
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