Working Capital Management and Firm Profitability in the Textile Industry of Bangladesh
Author (s)
Muhammad Matin Khan, Md. Ismail Hossain Shagor, Abu Kalam & Md. Sojib Ahmed
Abstract
This paper has been conducted to examine the connection between working capital management measured and profitability performance is measured. The study is conducted based on secondary data from annual reports of respective textile firms listed in DSE and DSE monthly reviews. From 2000 to 2018. The objective of the study is to find out the working capital devoted to the firms registered in the Dhaka stock exchange and find the connection of their performance and working capital capitalized in registered textile firms in DSE. To address this panel data, besides ratio and quartile study, Hausman test, variance inflation test, and fixed effect regression was done for testing all the hypotheses and the study result shows the inverse association with age and payment deferred period but a positive association with fixed asset turnover, cash conversion cycle, days sales outstanding, inventory conversion period, sponsor shareholdings and total assets. It also suggests to produce an effective policy must be produced for each company for each component of working capital. Besides, well-organized management and financing of working capital can upsurge the operating profit of a textile firm. Shorter cash conversion cycle, days sales outstanding, and the inventory conversion period can increase firms’ profit. These are some practical examples of working capital management.
Keywords: Working Capital Management, Firm Performance, Firm profitability, Textile Industry, Bangladesh.
| Title: | Working Capital Management and Firm Profitability in the Textile Industry of Bangladesh |
|---|---|
| Author: | Muhammad Matin Khan, Md. Ismail Hossain Shagor, Abu Kalam & Md. Sojib Ahmed |
| Journal Name: | International Journal of Science and Business |
| Website: | ijsab.com |
| ISSN: | ISSN 2520-4750 (Online), ISSN 2521-3040 (Print) |
| DOI: | https://doi.org/10.5281/zenodo.3935735 |
| Media: | Online |
| Volume: | 4 |
| Issue: | 7 |
| Acceptance Date: | 05/07/2020 |
| Date of Publication: | 08/07/2020 |
| PDF URL: | https://ijsab.com/wp-content/uploads/573.pdf |
| Free download: | Available |
| Page: | 118-127 |
| First Page: | 118 |
| Last Page: | 127 |
| Paper Type: | Research Paper |
| Current Status: | Published |
Cite This Article:
Muhammad Matin Khan, Md. Ismail Hossain Shagor & Abu Kalam (2020). Working Capital Management and Firm Profitability in the Textile Industry of Bangladesh. International Journal of Science and Business, 4(7), 118-127. doi: https://doi.org/ 10.5281/zenodo.3935735
Retrieved from https://ijsab.com/wp-content/uploads/573.pdf
About Author (s)
Muhammad Matin Khan (corresponding author) MBA, Department of Finance, University of Dhaka, Bangladesh.
Md. Ismail Hossain Shagor, MBA, Department of Finance, University of Dhaka, Bangladesh.
Abu Kalam, MBA, Department of Finance, University of Dhaka, Bangladesh.
Md. Sojib Ahmed, MBA, Department of Finance, University of Dhaka, Bangladesh.
DOI: https://doi.org/10.5281/zenodo.3935735