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Relationship Between Working Capital Management Efficiency and Profitability: A Comparative Study on Square Pharmaceuticals Limited and Beximco Pharmaceuticals Limited, in Bangladesh
International Journal of Economics, Finance and Management Sciences
Volume 5, Issue 2, April 2017, Pages: 121-128
Received: Jan. 19, 2017; Accepted: Feb. 10, 2017; Published: Mar. 9, 2017
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Authors
Rejaul Karim, Department of Business Administration, Varendra University, Rajshahi, Bangladesh
Md. Abdullah Al-Mamun, Department of Business Administration, Pabna University of Science and Technology, Pabna, Bangladesh
Md. Tota Miah, Department of Business Administration, Varendra University, Rajshahi, Bangladesh
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Abstract
Pharmaceutical is an important adjunct of industrialization in Bangladesh. This paper examines the effects of working capital management efficiency on the profitability of the two leading pharmaceuticals companies of Bangladesh - Square Pharmaceuticals Limited (SPL) and Beximco Pharmaceuticals Limited (BPL) and to make a comparison of financial efficiency between these two firms. The secondary data for a period of ten years (2006-2015) have been analyzed by using correlation, t-test, and different profitability, liquidity and solvency ratios. The study reveals that there is a significant relationship between working capital management efficiency and profitability of both of the firms. The study also finds Square Pharmaceuticals Limited is more efficient in working capital management than Beximco Pharmaceuticals Limited. The financial performance of Beximco Pharmaceuticals Limited should be improved immediately through the efficient management of working capital to increase its profitability.
Keywords
Pharmaceuticals Industry, Profitability, Working Capital Management Efficiency, Bangladesh
To cite this article
Rejaul Karim, Md. Abdullah Al-Mamun, Md. Tota Miah, Relationship Between Working Capital Management Efficiency and Profitability: A Comparative Study on Square Pharmaceuticals Limited and Beximco Pharmaceuticals Limited, in Bangladesh, International Journal of Economics, Finance and Management Sciences. Vol. 5, No. 2, 2017, pp. 121-128. doi: 10.11648/j.ijefm.20170502.16
Copyright
Copyright © 2017 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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