A Study of Working Capital

Management
at
Rockland
Hospitals Ltd. (Qutab)

By : Sandeep Kumar .M
04015903913
3rd sem M(A)

Introduction About the Industry

"The

healthcare sector in India is growing at

a 15%CAGRand jumped from $45 billion in
2008 to $78.6 billion in 2012 and expected to
touch $158.2 billion by 2017,"a report has
said.
The factors behind the growth is rising
incomes,
easier access
to
high-quality
healthcare facilities and greater awareness of
personal health and hygiene, the report said.

The

country's
healthcare
system
is
developing rapidly and it continues to expand
its coverage, services and spending in both
the public as well as private sectors, it said.

Introduction About the Company

Rockland Hospitals Ltd

Rockland Hospitals Limited

(RHL) was initially

set up in Dec 2004 under the trust
Foundation for Applied Research in Cancer
(FARC)

Rockland

Hospitals
Limited
(RHL)
was
incorporated by three brothers Mr. Rajesh
Kumar
Srivastava,
Mr.
Prabhat
Kumar
Srivastava and Mr. Rishi Kumar Srivastava.

RHL

is

currently

running

three

hospitals

100-bed
facility
at
Qutab
Institutional
area
103-bed facility at Dwarka launched in July 2012
505 bed super specialty hospital at Manesar

Introduction About the Topic

The

working capital management precisely

refers to management of current assets. A
firms working capital consists of its
investment in current assets
Working capital typically means the firms
holding of current or short-term assets
such as cash, receivables, inventory and
marketable securities.
These items are also referred to as
circulating capital
Corporate executives devote a considerable
amount of attention to the management of
working capital.

RESEARCH OBJECTIVE OF THE STUDY:

To

study the
working capital.

various

components

of

To

analyze the working capital trend at

Rockland Hospitals, Qutab.

To

appraise the utilization of current asset

and current liabilities and find out shortcomings if any.

To

suggest
measure
for
management of working capital.

effective

RESEARCH METHODOLOGY OF THE

STUDY
Research Design
The research design followed to study the
working capital management in Rockland
Hospitals, Qutab is Descriptive Research
Design.
Sources of Data Collection

Secondary Data - Secondary data are those

which are already being collected and stored.

This project is also based on secondary data

collected through annual reports of the
organization. The data collection was aimed
at study of working capital management of
the company.

LIMITATIONS OF THE STUDY

The

topic working capital management is itself

a very vast topic yet very important also. Due
to time restraints (2 months duration) it was
not possible to study in depth in get knowledge
what practices are followed at Rockland
Hospitals Pvt. Ltd (Qutab).

Many

facts and data are such that they are not

to be disclosed because of the confidential
nature of the same.

Since

the financial matters are sensitive in

nature the same could not be acquired easily.

The

study is restricted to only the 3 Years data

of Rockland Hospitals, Qutab.

Findings of the study

Working

capital of the Rockland Hospitals

Pvt. Ltd. (Qutab) was increasing and
showing positive working capital per year.

The

Rockland Hospitals Pvt. Ltd. (Qutab)

has higher current and quick ratios are i.e.,
2.87 and 2.30 respectively.

Inventory turnover ratio is very low in the

year 2010-11. In the year 2011-12 it has
increased by 6.32 times as compared to
2010-11 and in the last year 2012-13 it has
again increased by 3.26 times as compared
to 2011-12.

Findings of the study contd...

Debtors

turnover ratio is very high in the year

2010-11. In the year 2011-12 it has decreased by
5.28 times as compared to 2010-11 and in the
last year 2012-13 it has again decreased by 0.44
times as compared to 2011-12.

Creditors

turnover ratio is low in the year of

2010-11. It increases by 0.75 in the year 2011-12
as compared to 2010-11and remains same in the
last year 2012-13 as compared to 2011-12.

Working capital turnover ratio is very low in the

year 2010-11. In the year 2011-12 it has
increased by 0.95 times as compared to 2010-11
and in the last year 2012-2013 it has again
increased by 0.03 times.

Recommendations

Working

capital of the company has increasing

every year. Profit also increasing every year this
is good sign for the company. It has to maintain
it further, to run the business long term.

The

Current and quick ratios are almost up to

the standard requirement. So the Working
capital management of Rockland Hospitals Pvt.
Ltd. (Qutab) is satisfactory and it has to
maintain it further.

The

company has sufficient working capital and

has better liquidity position. By efficient
utilizing this short-term capital, then it should
increase the turnover.

Recommendations Contd..
The

company should take precautionary measures

for investing and collecting funds from receivables
and to reduce the bad debts.

The

company has sufficient working capital and

has better liquidity position. By efficient utilizing
this short-term capital, then it should increase the
turnover.

Creditors

turnover ratio has increased from 201011 to 2011-12 and in the last year 2012-2013 it is
same as compared to 2011-12. Company is making
prompt payment to its creditors. This is good sign
for the company. On-time payment to suppliers
will increase the credibility of the firm. It has
maintained it further to survive in the market.

CONCLUSIONS

The

study on working capital management

conducted in Rockland Hospitals Pvt. Ltd.
(Qutab) to analyze the financial position of
the company. The companys financial
position is analyzed by using the tool of
annual reports from 2010-11 to 2012-13.

The

financial status of Rockland Hospitals

Pvt. Ltd. (Qutab) is good.

In

the last year the inventory turnover has

increased, this is good sign for the
company.

CONCLUSIONS contd..

The

companys liquidity position is very

good With regard to the investments in
current assets there are adequate funds
invested in it. Care should be taken by the
company not to make further investments
in current assets, as it would block the
funds, which could otherwise be effectively
utilized for some productive purpose. On
the whole, the company is moving forward
with excellent management.

Bibliography

Journals & Text Books

Guy,
(2001)Working
Kouma

capital

Gass

Capital

management
in
healthcare
www.@akdesniz.edu.tr Volume 5; page No 76-89
D, How To Improve
Management (2006)

Working

Maynard

E.
Rafuse,

Working
capital
management: an urgent need to refocus
Management Decision, (1996)

Raheman

and Nasr; variables of

capital management year ( 2004).

working

Bibliography Contd..

Prasanna

Chandra,
Financial
Theory and Practice, 5TH Edition,

Management

Tata

McGraw Hill Publishing Company Limited,

New Delhi, 2001.

Annual Reports of Rockland Hospitals Pvt. Ltd.

Websites
http://www.pwc.in/industries/healthcare.jhtml
https://www.wbginvestmentclimate.org/toolkits/
public-policy-toolkit/mod3step6sub1.cfm

http://www.rocklandhospitals.com/qutab/
http://www.rocklandhospitals.com/content.php?
linkid=140