International Research Journal of Education and Technology

The textile industry plays an important role in the Indian economy and has developed significantly over the years. The purpose of this study is to analyze working capital management and to make a bankruptcy prediction in the textile industry. Working capital management is important for any business to ensure that the business is able to carry on its business and has the sufficient cash flow to service its short term debt. Working capital refers to the funds available for the day-to-day operations of a company. Working capital supports short-term operating costs and maintains sufficient cash flow to maximize profitability. This study aims to analyze the working capital management of five selected textile companies over a five-year period. The research is conducted on five selected textile companies and is based primarily on secondary data. Secondary data are obtained from the moneycontrol.com and websites of five selected textile companies. The period of study is limited to five financial years from 2017-2018 to 2021-2022. The efficiency of working capital management is assessed using ratio analysis and the Z-score model. The results from the study reveal whether the five selected textile companies are using their working capital efficiently.

KEYWORDS: Working capital, Ratio analysis, Altman’s Z-score model