A Study on Working Capital Management of MSL Enterprises

A Study on Working Capital Management of MSL Enterprises

Santhosh Kumar T1 , Dr. R.Thamilselvan2

1MBA Student School of Management Studies, Sathyabama Institute of Science and Technology,Chennai, Tamil Nadu, India--6000119

2 Research Guide and professor school of Management studies Sathyabama Institute of science and Technology, Chennai, Tamil Nadu.

ABSTRACT

Working capital management becomes a necessity in order to keep the operations stable and financially sound, especially for manufacturing firms wherein huge amounts of capital are more than likely going to be locked up in working assets. In this study, the working capital management of Chennai-based MSL Enterprises Pvt. Ltd., engaged in the process automation industry, is analyzed over the period between 2019 and 2024. It aims to assess the efficiency with which the firm manages short-term assets and liabilities and how much impact these have on its liquidity, profitability, and financial health.

Through the application of a combination of ratio analysis and year-to-year statements of working capital variation, the research determines trends in such important financial indicators as current ratio, quick ratio, inventory turnover, and debt-to-equity ratio. Although MSL has managed to demonstrate a rising gross profit margin, as well as improved operating efficiency, analysis also discovers liquidity volatility, declining inventory efficiency, and rising reliance for debt financing.

The study concludes that MSL can enhance its financial performance through strategic improvements in receivables collection, inventory management, and capital structure management. The study offers practical suggestions for small and medium-sized manufacturing firms seeking to enhance their short-term financial management and achieve long-term sustainability in a competitive industry.

Keywords: Working Capital, Liquidity, Profitability, Financial Performance, Ratio Analysis, Manufacturing, MSL Enterprises.