Efficiency of Working Capital Management using Y-Score Model: An Evidence of BSE SENSEX.

Abstract

Due to supply chain interruptions, the COVID-19 pandemic posed substantial issues in managing working capital. The current study looks at the effectiveness of working capital management among non-financial firms listed in the BSE SENSEX from the 2010-11 to 2019-20. The Y-Score model and its various constituents were used to analyse the efficiency of working capital management. In addition, various regression models have been developed for the desired level of efficiency. The overall Y-Score model depicts that the firms listed in the BSE SENSEX perform well in managing working capital during the study period. Furthermore, the Sun Pharmaceutical Inds Ltd was the only successful firm followed by Nestle India Ltd, Reliance Industries Ltd to achieve the target level of efficiency. The study suggests that companies listed in BSE SENSEX should improve their sales faster than tangible assets and also firms should improve their cash flows.