Analysis of Working Capital Management in Godfrey Phillips India

Saloni Singha and Sunil Kumar

Journal of Accounting and Finance in Emerging Economies, 2025, vol. 11, issue 3, 345-364

Abstract: Purpose: This study examines the effectiveness of working capital management at Godfrey Phillips India Ltd. from 2021 to 2025. It assesses its impact on profitability, liquidity, and operational efficiency, provides insights into the company’s financial stability, and identifies areas for improvement to ensure sustained performance.Design/Methodology/Approach: The study adopts a descriptive and analytical approach, utilising secondary data from annual reports. It applies financial ratio analysis, along with correlation and regression techniques, to evaluate trends and the relationships between profitability, liquidity, and working capital efficiency.Findings: GPI validated steady increases in sales and net profit, driven by effective working capital management. However, the Quick Ratio stayed below the optimal level, indicating liquidity concerns. Statistical analysis presented a strong positive link between profitability and working capital efficiency, while liquidity ratios were negatively related to profit, signifying potential short-term risks despite strong earnings.Originality/Value: This research paper presents a comprehensive perspective by integrating ratio analysis with statistical validation, highlighting the balance between profitability and liquidity. It provides practical insights for enhancing receivable management and implementing technology-based financial controls to support long-term economic resilience

Keywords: Regression; Correlation; ANOVA; Financial ratios; Working capital (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:src:jafeec:v:11:y:2025:i:3:p:345-364

DOI: 10.26710/jafee.v11i3.3464

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