A Study on Working Capital Management and its Impact on Profitability of EZOFIS Company

Vishnu Priya B

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M.B.A. Candidate, Department of Management Studies, Panimalar Engineering College

Anna University, Chennai – 600 123, India

Dr. N. Venkateswaran B.E., M.B.A., Ph.D.

Dean & Professor, Department of Management Studies, Panimalar Engineering College

ABSTRACT:This study examines the relationship between working capital management and profitability in Ezofis, a professional financial services firm. Effective management of short-term assets and liabilities is essential for maintaining liquidity, ensuring smooth operations, and enhancing financial performance. The research adopts an analytical approach using financial data over a three-year period (2022–2024) and applies tools such as ratio analysis, correlation, regression, and trend analysis to evaluate efficiency and performance. The results indicate that the company maintains a strong liquidity position, with improving current and quick ratios reflecting efficient cash and receivables management. Although the working capital turnover ratio shows a slight decline, overall operational efficiency remains stable. Statistical findings reveal a strong positive relationship (r = 0.92) between working capital and profitability, confirming that effective management of short-term resources contributes directly to financial growth. The regression equation (Y = –10.83 + 0.25X) further validates this relationship. The study concludes that balanced working capital management enhances both liquidity and profitability, supporting sustainable business operations.
Keywords: Working Capital Management, Profitability, Liquidity, Financial Performance, Ratio Analysis, Cash Conversion Cycle, Receivables Management, Correlation & Regression Analysis, Operational Efficiency, Service Sector Finance