Siddhant- A Journal of Decision Making

A corporate sector, to survive in the competitive business world, should maintain its appropriate liquidity position to meet its current obligation. Conversely, a corporate sector disappoints if it is not able to meet its short-term responsibility in due course of time, resulting in bad credit rating by outsiders and decrease in the value of reputation in the market. Bearing in mind the rigid competition happening in current commercial atmosphere, analysing liquidity and examining its effect on profitability are extremely important to the business managers for quick decision-making competence and superiority. In this framework, in the present study, an effort has been made to analyse the liquidity management and financial performance of Oil and Natural Gas Corporation (ONGC) and Indian Oil Corporation Limited (IOCL), leading petroleum producing industries in India for the period 2006–2007 to 2015–2016. To investigate the liquidity positions and measure the degree of relationship between liquidity and profitability of ONGC and IOCL, different financial ratios analysis, comprehensive rank test, Spearman's rank correlation analysis and t test have been employed.