One very important element affecting the profitability of a concern is the investment on inventories. It is essential to control the inventories (physical/quantity control and value control) as these are the elements in the costing process constituting some times more than 60 per cent of the current asset. The raw materials, work-inprocess goods and completely finished goods that are considered to be the portion of a business's assets that is ready or will be ready for sale. Inventory represents one of the most important assets that most business possesses, because the turnover of inventory represents one of the primary sources of revenue generation. Kerala Agro Industries Corporation Ltd (KAICO), a premier organization in the agriculture sector with the object of promoting agro based industries in the state of Kerala for the production of farm equipment's, machinery and implements required by the farming community. KAICO has favorable liquid position due to the increase in the current asset and working capital. The inventory turnover ratio was increased and average holding period of inventory decreased it showed KAICO has strong sales of inventory. The study found that the existing inventory management practice of KAICO is good and it will automatically leads to the efficient management of working capital. The total inventory of KAICO is less than industrial averages, a good symptom of inventory management by KAICO.
KAICO-Kerala Agro Industries Corporation, inventory turnover, industrial average
