LIQUIDITY ANALYSIS OF SELECTED PHARMACEUTICAL COMPANIES IN INDIA

Abstract

This paper focuses on the liquidity position of selected companies of pharmaceutical industry in India. An attempt has been made to understand the abilities of selected pharmaceutical companies to pay short term debt obligations, how does these differ and get affected over a sufficient period of time. The major stress has been laid down on studying liquidity ratios of selected top 30 pharmaceutical companies in India. A comparative external analysis of these companies has been done for the period of 13 years. This analysis helps these companies to identify the strategic financial moves while establishing their standard goals for the long run. The present study has made use of various financial and accounting ratios which have been tested with the help of appropriate statistical tools like averages, standard deviation and coefficient of variation. These ratios have been further examined with the help of Repeated measure ANOVA. The paper has concluded that there is significant difference between related population means of current ratios and quick ratios of the company over the years. However the liquidity position of the pharmaceutical companies is quite satisfactory over the period under study.

Keywords: pharmaceutical company, liquidity, India, debt obligations.