Working capital management, measured through components such as cash conversion cycle (CCC), accounts receivable, inventory holding period and accounts payable, plays a critical role in determining a company's liquidity and profitability. The primary objectives of earlier studies are to analyze the relationship between WCM components and profitability, examine industry differences, and identify effective working capital practices. Most studies show that shorter CCCs and effective accounts receivable and inventory management have a positive impact on profitability measures suchas return on assets (ROA) and return on equity (ROE). However, issues such as small sample size, short study period, limited coverage, and methodological constraints reduce the reliability and generalizability of the results. The main research gaps are the lack of comprehensive cross-industry research on Indian companies and the limited use of advanced panel data techniques. \ fill this gap, this study uses a quantitative research method using panel data analysis. Secondary data is collected from reliable annual reports and financial databases. The study concludes that effective working capital management significantly enhances profitability, though its impact varies across industries and firm size. \
Patil et al. (2026) studied this question.