Both Government as well as the private sectors has come forward for the development of themanufacturing sector of the country. More investments are being proposed in the sector particularly in the growth rate of capital goods, consumer durables, and some non-durable goods.The coming budget 2007-08 is to emphasize on the manufacturing sector in India’s Economy for sustaining its growth and achieving development goals.
OBJECTIVE OF THE STUDY
A well designed and implemented working capital management is expected to contribute positively to the creation of a firm’s value.
The main objective is to examine the trends in working capital management and itsimpact of firms’ performance.
The trend in working capital needs and profitability of firms are to be examined toidentify the causes for any significant difference between the industries.
To study the key variables used in the analysis like inventories days, accounts receivablesdays, accounts payable days and cash conversion cycle.
To analyze how the firm is required to maintain a balance between liquidity and profitability while conducting its day to day operations.
To study the success factors that contribute to success or failure of a particular firm for example availability of attractive financing, economic conditions, competition,government regulations, technology and environmental factors.
To analyze effective management of working capital as it may have a consequent impacton small business survival and growth.
To study how the firm is meeting day-to-day cash flow needs.
To analyze how the firm pays wages and salaries when they fall due.
To know how the firm makes regular payments to creditors to ensure continued suppliesof goods and services.
To know how the firm is meeting with the payments of government taxes
To analyze long term survival of the business entity.