An Analysis of Working Capital Management in Select Construction Companies

For a successful working of a business organization fixed and current assets play a vital role as an organization generally invests in these options. An attempt has been made in this paper to study the working capital components and the effect of working capital management policies on the profitability of 10 Infrastructure companies. The paper also tries to study the correlation between liquidity, profitability and Profit before Tax (PBT) of selected Infrastructure companies. The study is based on secondary data collected from annual reports of different Infrastructure companies and PROWESS (CMIE Database) for the period 2007 to 2012. In this paper, there is an application of correlation and regression analysis to identify the significant effects of Working capital management on profitability. The Management of operating capital is indispensable as it might induce a direct impact on profitability and liquidity