| SMART JOURNAL OF BUSINESS MANAGEMENT STUDIES |
VOL. 7 |
NO. 2 |
PAPER 8 |
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GROWTH AND CORPORATE PROFITABILITY :A STUDY IN INDIAN AUTOMOBILE INDUSTRY |
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| A.Vijayakumar* and S. Sri Devi** |
| * Associate Professor in Commerce, Erode Arts and Science College, Erode 638 009. Tamil Nadu.India |
| Research Associate & Full time Ph.D Research Scholar, Department of Commerce, Erode Arts and Science College, Erode,Tamil Nadu, India. |
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| This study investigated the Relationship between the Growth of Indian Automobile Industry and their Profitability. The empirical evidence indicates that growth rates were highly volatile over the study period and the relationship with profitability was not clear. However, the positive effects of growth on profitability were greater than the negative effects. Also the extent of this positive relationship was different in different companies, depending upon ability and willingness to grow, which may further depend upon factors like extent of monopoly power, growth of demand, market share, better labour relations and other managerial conditions etc.,. Concerning the other empirical evidence obtained in this study, it is concluded that (1) there was considerable persistence of profitability in Indian Automobile Companies;(2) greater size of Indian Automobile Companies means increased profitability (3) greater recourse to debt by Indian Automobile Companies means diminished profitability; and (4) Liquidity also appears to be relevant in explaining the profitability of Indian Automobile Companies. |
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