“Efficient management of working capital: A study of Automobile industry in India”

Working capital plays an important role in any business and is the lifeline of any business. Working capital management is the one of the top issue faced by most of the manufacturing firms. The main objective of this study is to measure the efficiency of working capital of firms in automobile sector in India and also to determine the impact of efficient management of working capital on the profitability of the firms. Top 10 automobile manufacturing firms of India have been selected as a sample for this study. Secondary source of data has been used for this study for 10 years from 2007-2008 to 2016-2017. The result shows that Force Motors is the most efficient firm whereas Ashok Leyland is the least efficient. The result of correlation and regression analysis showed that there is positive relation between efficiency index and profitability of the firms but the impact is not significant which means there are other components also which affects the profitability of the firm and can be undertaken for further studies.