This study is an attempt to investigate the relationship between working capital management and profitability by making an inter sector comparison of two manufacturing industries i.e. steel industry and chemical industry. For this purpose, we selected 15 companies from each sector, based on market capitalization and listed on BSE-500 for a period of five years from 2009–2013. Major eight financial ratios relating to profitability as well as working capital management are taken for analysis. The study is designed to show the Profitability and Working Capital position of Steel and Cement Industries. Ratio Analysis, Correlation Matrix and Regression Analysis have been used as the research tools. The results of this study show that both the industries have a significant relationship between profitability and working capital management. Working capital management variables affect more strongly the profitability indices of Cement industry than those of Steel industry.
Working Capital Management, profitability, Steel industry, Cement industry
