Working Capital Management and Ratio Analysis of Paper Mills

The working capital management has a significant contribution for firm's profitability as well as to maintain liquidity powers. The motive of this study is to find out working capital adequacy and its impact on profitability [1]; to investigate the relationship between profitability and liquidity of firms. The amount invested in working capital is often high in proportion to the total assets employed and so it is vital that these amounts are used in an efficient way. Working capital management main aims at maintaining a balance between liquidity and profitability while conducting the day to day operations of business concern. Improper working capital management not only decreases the profitability of business but also ultimately lead to financial problems, Chowdhury and Amin (2007). The study aims to provide empirical evidence about the effects of in current assets and current liabilities of JK Paper Mills Limited and Emami Paper Mills Limited.