Profitability And Working Capital Management In Agro-Based State-Owned Enterprises In Kerala: A Case Study Of Oil Palm India Limited, Kottayam

Abstract

The financial performance of public sector enterprises plays a critical role in assessing their operational sustainability and economic contribution. This study focuses on Oil Palm India Limited, a state-owned enterprise (SOE) in Kerala, to evaluate its profitability and the efficiency of working capital utilization over a selected period. The study offers insights into the firm's capacity to turn a profit and efficiently manage its short-term assets and liabilities by examining important financial ratios like the gross profit ratio, operating profit ratio, net profit ratio, Return on Investment (ROI), Return on Capital Employed (ROCE), Return on Assets (ROA), Current ratio, Working capital turnover ratio, Inventory turnover ratio, Receivable turnover ratio, and payable turnover ratio. The company's published financial statements served as the source of secondary data, and performance patterns were interpreted using procedures including trend analysis and ratio analysis. The results show variances in working capital management efficacy and profitability, pointing to the necessity of more stringent operational efficiency controls and strategic financial planning. In addition to providing insightful implications for politicians and company managers seeking to advance public sector reform and improve efficiency, this targeted assessment advances a more comprehensive understanding of the financial performance of state-owned businesses.