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http://dx.doi.org/10.13106/jafeb.2022.vol9.no7.0249

The Impacts of Three Sub-Policies and Sub-Strategies of Working Capital Management on Firm's Performance in Thailand  

WICHITSATHIAN, Sareeya (Institute of Social Technology, Suranaree University of Technology)
Publication Information
The Journal of Asian Finance, Economics and Business / v.9, no.7, 2022 , pp. 249-260 More about this Journal
Abstract
The objective of this study was to investigate the impacts of working capital policy and strategy on a firm's performance including profitability and market value. By applying One-Sample T-Test, working capital investment and financing policies were classified into the three sub-policies and strategies: aggressive, moderate, and conservative, unlike previous studies using two sub- policies and strategies. The results showed that the SET-listed companies in all seven industry sectors primarily adopted an aggressive working capital investment policy and a conservative working capital financing policy, so-called as moderate working capital management strategy (MWS), at 49.40%. While the firms adopted and conservative working capital management strategy (CWS), 45.70%, followed by the aggressive working capital management strategy (AWS), at 4.90%. When examining the impacts among three-sub policies and strategies on a firm's performance, it was found that the conservative working capital financing policy led to the highest profitability and market value in all industry sectors. The findings also revealed that the aggressive strategy has no impact on a firm's performance in terms of profitability and market value.
Keywords
Sub-Policies; Sub-Strategies; Working Capital Management; Firm Performance;
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Times Cited By KSCI : 3  (Citation Analysis)
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