Impact Of Working Capital Management On Sustainable Growth And Profitability: Evidence From Chemical And Manufacturing Sectors Of Pakistan

Abstract

In Pakistan's chemical and manufacturing industries, this study examines the connection between sustainable capital growth and working capital management and how it affects working capital and profitability. The research intends to add to our knowledge of how effective working capital management affects the profitability and longevity of businesses in various fields. Working capital management is the independent variable, whereas profitability and working capital growth are the dependent variables. Data was collected from a sample of 36 chemical companies and 34 industrial companies using a purposive sampling strategy. To examine the connection between working capital management and the dependent variables while accounting for relevant firm-specific characteristics, a multiple regression analysis is conducted. The results of this study shed light on the importance of sustainable working capital management as a factor in determining sustainable growth and profitability for businesses in Pakistan's chemical and manufacturing industries. It is clear from the study's findings that effective management of working capital is crucial to improving financial performance and fostering sustainable business growth, which has broad implications for both practitioners and policymakers. The findings of this study contribute to the growing body of knowledge on the topic of working capital management and the effects it has on firm-level outcomes in developing economies.