A Study on Formation of Working Capital Sathyabama Institute of Science and Technology Chennai- 600 119

Working capital is essential for smooth day-to-day business operations. It helps maintain liquidity, profitability, and financial stability. This study focuses on working capital formation practices followed by finance-related companies in Ranipet surrounding areas. Primary data was collected from 103 respondents through a structured questionnaire using Google Forms. Percentage analysis and Chi-square test were used for analysis. The study found that most respondents consider working capital highly important for business operations. The Chi-square test shows significant preference for combined methods such as cash management, inventory control, and faster collection of receivables. The study concludes that proper planning and monitoring improve working capital efficiency and long-term growth.