RELATIONSHIP BETWEEN WORKING CAPITAL MANAGEMENT AND PROFITABILITY OF COMPANIES LISTED ON THE STOCK EXCHANGE OF THAILAND: BEFORE AND DURING THE COVID-19 PANDEMIC
Keywords:
Working Capital Management, Profitability, COVID-19 PandemicAbstract
The purpose of this study was to study the relationship between working capital management and profitability of companies listed on the Stock Exchange of Thailand (SET) before and during the COVID-19 pandemic. A sample group was the companies with financial statements and financial ratios in 2018 – 2022.
The results of data analysis including before and during the COVID-19 pandemic revealed that the collection period from debtors’ payment, debt repayment period and inventory period correlate with the return on assets in the opposite direction. As for the analysis of data before the outbreak of COVID-19, it was found that only repayment period from debtors was related to the return on assets in the opposite direction. Moreover, from the analysis during the COVID-19 pandemic, it was found that only the repayment period to creditors had an inverse relationship with the return on assets. As for the analysis of the relaxation period of the COVID-19 pandemic, it was not found that the period for receiving debt payments from debtors, period of repayment to creditors and inventory period were related to the return on assets and found that the COVID-19 pandemic has no significant effect on the return on assets.
In addition, it was found that the control variable consisted of the size of the business correlated with the return on assets in the same direction, whereas the debt-to-equity ratio was inversely related to the return on assets.
References
Boonthanomwong, S. (2015). An Association Between Profitability and Asset Management Efficiency (Independent Study). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:94333
Charoenlert, K. (2020). The Study of Impact of Covid-19 on Stock Price Across Different Sectors and Sub-Sectors: A Case Study of Companies Listed on The Stock Exchange of Thailand (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:185636
Chawsurin, S., Kasemsiri, J., Chewwattana, W., Manipantee, S., & Chuchan, N. (2021). The Impact of the Coronavirus Disease 2019 (COVID-19) Pandemic on Children with Chronic Diseases and Guidelines for Providing Care. Vajira Nursing Journal, 23(2), 97-107.
Erik, R. (2012). Effects of Working Capital Management on Company Profitability: An
industry-wise study of Finnish and Swedish public companies (Master’s thesis). Retrieved from https://helda.helsinki.fi/server/api/core/bitstreams/f0f0bfb5-8daa-4456-9d32-59acaacbce7b/content
Hathaicharoenlarp, T., (2011). Working capital management and corporate performance of manufacturing sector in Thailand (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:121935
Kanokwaranon, S. (2020). The Study of Covid-19 Pandemic Effect on Tourism Industry’s Companies in the Stock Exchange of Thailand: Financial Firm Characteristics Mitigating the Effect of Covid-19 (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:185694
Kiatgasikorn, S. (2020). The Relationship between Profitability and working Capital Management of Construction Firms in Bangkok Area Revenue Office 25
(Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/
frontend/Info/item/dc:184795
Kweekarnjanakul, V. (2018). The study of Relationship between Trade Credit and Profitability of Listed Companies in Market for Alternative Investment (MAI) (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/
Info/item/dc:163318
Li, Y. (2020). The Relationship between Profitability and Working Capital Management of Photovoltaic Related Manufacturing Firms on Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE) (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:184986
Manprasert, S. (2020). Impact of the COVID-19 pandemic to the Thai
economy. Retrieved from https://www.krungsri.com/th/krungsri-the-coach/investments/investment-knowledge/economic-covid-impact
Mhd, A. H. (2015). The Effect of Working Capital Management on Firms’ Profitability: Comparative Study on Middle East and West Europe Companies. (Master’s thesis). Retrieved from https://docplayer.net/21751642-The-effect-of-working-capital-management-on-firms-profitability-comparative-study-on-middle-east-and-west-europe-companies.html
Mohit, B. (2021). Impact of Working Capital Management on Business Profitability. (Master’s thesis). Retrieved from https://norma.ncirl.ie/5408/1/mohitbisht.pdf
Nasomyon, N., & Kaewploy, N. (2019). The Relationship between Working capital Management and Profitability which Affects to Stock Price of Listed Companies in Commercial Business in Thailand. Proceeding of the 14th UTCC National Graduate Research Conference 2019, 448-457.
Pestonji, C. (2018). The Impacts of Working Capital Management on Firm’s Performances of Listed Companies in The Stock Exchange of Thailand (Doctoral dissertation). Retrieved from http://sutir.sut.ac.th:8080/jspui/bitstream/
/8048/2/Fulltext.pdf
Pongpunpisand, P., Sununtiwat, M., Pumtong, S., & Anuratpanich, L. (2022). The Health Impact of the Covid-19 Pandemic on Visually Disabled Persons in Bangkok Journal of Health Systems Research, 16(2), 169-182.
Rafathunnisa, S. (2021). Impact of Working Capital Management on Profitability: A
Case Study of Trading Companies. Chapters, in Nizar Mohammad Alsharari (ed.), Accounting and Finance Innovations, IntechOpen.
Srirueangmetta, A. (2020). The Impact of Capital Structure on Firms’ Performance of Listed Companies on The Stock Exchange of Thailand (SET100) before and during Pandemic Covid-19 (Independent Study). Retrieved from https://www.scribd.com/document/617646467/TU
Subtanarat, P. (2018). The Relationship between Profitability and Working Capital Management of Manufacturing Firms on the Stock Exchange of Thailand (SET) (Independent Study). Retrieved from https://ethesisarchive.library.tu.ac.th/
thesis/2018/TU_2018_6002112602_10021_10129.pdf
Surarit, I. (2020). The effect of Applying Temporary Relief Measures on Accounting Alternatives in Response to The Impact of the Covid-19 Situation on Firm Value and Accounting Performance (Master’s thesis). Retrieved from https://digital.library.tu.ac.th/tu_dc/frontend/Info/item/dc:186238
Thailand Development Research Institute (TDRI). (2021). Impact of COVID-19 outbreak, 2nd round, Continuing 3rd round, and the direction of the Thai labor market. Retrieved from https://tdri.or.th/2021/04/covid-19-2-3-affected-thai-labor-market/
Tongpoon, T. (2021). The relationship between working capital management and profitability of automotive companies in Thailand (Independent Study). Retrieved from http://dspace.bu.ac.th/bitstream/123456789/4782/3/thanaporn_tong.pdf
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Business Administration and Economics Review
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
The contents in Business Administration and Economics Review can be used for publication. But do not modify, modify or use it for trade and profit.
