AN ANALYSIS ON WORKING CAPITAL EFFICIENCY – A STUDY WITH REFERENCE TO DORMAKABA INDIA LIMITED

Abstract

The study aims to explore the effects of components of working capital management like Current ratio (CR), Debt ratio (DR), Quick Ratio (QR), Inventory turnover ratio (ITI), Net Working Capital Ratio(NWC) on profitability of the firm. The profitability of the firm is measured in terms of net operating profitability and current ratio. Working capital management is considered to be a vital issue in financial management decisions and its affects both liquidity and profitability of the firm. The secondary data for analysis is retrieved from Dormakaba India Limited Annual report for six years from 2014-2015 to 2018- 2019. Apart from using Ratio Analysis, Scheduling of working capital, Horizontal analysis, and Vertical analysis are employed in the study. The study result shows a negative association between liquidity (CR) and profitability (NOP). This shows an inverse relationship between these two variable. So, the firm needto maintain a balance or trade-off between these twomeasures.