A Study on Working Capital Management Efficiency

Efficient management of working capital is an important indicator of sound health of an organization. The successful performance of a firm depends on its financial manager's efficient management of receivables, inventories and current liabilities. Companies can decrease their resource costs by decreasing amount of resources assigned to circulating assets or they can increase their funding abilities. To measure the working capital efficiency of large and small Indian pharmaceutical companies, the data have been collected for the period of 10 years from 2002–03 to 2001–12. Statistical measures average, minimum, maximum, ratio analysis, Bhattacharya's Efficiency Index, regression analysis and ANOVA have been used for the analysis. According to the analysis made in the various utilization, performance and efficiency indices of large and small pharmaceutical firms, the efficient management of working capital leads efficiency in the firms.