A study on efficiency of inventory management with reference to Larsen & Toubro Limited: An emperical study

Inventory management is most important aspect for the total management of an enterprise. It is ultimately the responsibility of the top management to achieve tradeoffs among marketing, finance, production and other functions so as to obtain, as far as possible, an optimized and relatively balanced trade off so as to maximize the overall performance of the enterprise. This has to be not only in the short-run but also keeping the long run interests of the company in view. The motives for keeping inventories differ between companies, depending on if the inventory is designed for a process, a flow of materials, or for a function it has for a company. Inventory Management refers to maintaining, for a given financial investment, an adequate supply of something to meet an expected demand pattern. It thus deals with determination of optimal policies and procedures for procurement. In business management, inventory consists of a list of goods and material held or available in stock. In the present research, the Analytical Research design was adopted by the researcher. The study was focused in LARSEN & TOUBRO LIMITED for a period of five years from 2008 -2009 to 2012 -2013. The data was collected from the company's annual reports and other related information was gathered from the journals and books. An attempt was made to find out the efficiency of inventory management successfully managed in the company with the statistical tools. The simple percentage analysis and ratio analysis was to be carried out to find out inventory valuation and the working capital requirement must be determined.