Working Capital Management: A study of Cement sector

Working Capital management is concerned with the problems that arise in attempting to manage the current assets, the current liabilities and the interrelationship that exists in between them. The success of an organization to a greater extent depends upon the effective management of working capital. The present work therefore is a modest attempt in this direction by undertaking a study of working capital management. The current paper has tried to examine the sources used by the companies to finance their working capital requirements and to analyze and evaluate the working capital management. The paper has also examined the liquidity position of the companies. In order to examine and analyze, secondary data of five companies was collected in cement sector i.e. ACC, Grasim, Ambuja, Prism and Ultra-Tech. Financial statements of these companies were collected for the period of two years from 1^st April, 2007 to 31^st March 2009 and ratio analysis was conducted. Liquidity and Activity ratios were calculated and analyzed to check the working capital conditions of these cement companies. The study shows that out of the five cement companies, overall ACC has got the best working capital management.