WORKING CAPITAL MANAGEMENT - IT’S IMPACT ON LIQUIDITY AND PROFITABILITY - A STUDY OF COAL INDIA LTD

Abstract

The present paper makes an attempt to give a conceptual insight on working capital management and assess its impact on liquidity and profitability of Coal India Ltd. The liquidity and profitability tradeoff has become an important aspect for all the organizations. The attempt also has been made to test the liquidity and profitability position. For this correlation and spearman’s rank method has been applied. The correlation and spearman’s ranking method indicates weak correlation and negative relationship between liquidity and profitability. The Motaal’s test has also been applied to test the liquidity performance. It indicates liquidity position of the firm has improved over the study period. The study covers five year data from 2010-11 to 2014-15. For the analysis ratios indicating working capital performance and some statistical techniques are employed.