An Empirical Study on Efficiency of Working Capital Management in Public Sector Power Industry with Special Reference to NTPC Limited

Abstract

The working capital plays critical role in the financial performance of a company. NTPC newlinebeing the leading power producing company contribute highest percent in the country power newlineproduction and is the role model for the rest of the companies working in the power sector. newlineIt is essential to set standards for the other companies in the power sector to assess their newlineworking capital management on similar lines and to continue to be profitable . Such lessons newlineif found suitable , to be drawn and could be generalized and followed in the entire power newlinesector to assess the financial performance in terms of prudent working capital management newlinepolicies and techniques. Accordingly this study was undertaken for studying the efficiency newlineof the working capital in NTPC limited for the period 2007-08 till 2014-15 and if there exist newlinea scope for the improvement in working capital management at NTPC Limited , newlineThe working capital and its various components were studied and analysis of the liquidity , newlineprofitability and risk analysis were conducted .Ratio analysis, variance analysis , trend newlineanalysis and various Hypothesis for the testing of the difference between the estimated newlineworking capital and the actual working capital, relationship between working capital and newlinecapital employed and profitability, relationship between liquidity and profitability, newlinerelationship between working capital and profitability, relationship between sales and cash newlineand bank balance held by the company, relationship between accounts receivables and sales newlineand relationship between inventory and sales were being done . newline