A cross-industry analysis of working capital management in India: pre and post financial crisis. (2017)

• Record Type: Journal Article
• Authors: Singh, Harsh Partap; Kumar, Satish
• Is Part Of: International journal of management practice. Volume 10:Number 2(2017)
• Page Start: 152
• Page End: 174
• Publication Date: 2017
• Subjects: cash conversion cycle -- days receivable outstanding -- days payable outstanding -- days inventory outstanding -- performance index -- utilisation index -- efficiency index -- global financial crisis -- cross-industry analysis -- working capital management -- India; Management -- Periodicals; 658.005
• Languages: English
• ISSNs: 1477-9064

Abstract

The main objective of this paper is to evaluate the working capital measures such as cash conversion cycle (CCC), days receivable outstanding (DRO), days payable outstanding (DPO) and days inventory outstanding (DIO) across industries and determine whether differences exist among different industries with respect to working capital measures in India. In addition to that, an attempt has also been made to test whether the efficiency of working capital management (WCM) in Indian companies has improved after the global financial crisis (GFC) of 2008. To achieve these objectives, financial data of 896 firms listed on Bombay stock exchange (BSE) for the period of 12 years (2002-2013) has been analysed. The results of this study indicate that working capital measures (DIO, DPO, DRO and CCC), are significantly differ in various industry groups. It is also observed that Indian companies have become more efficient in managing working capital after the GFC of 2008.