At a time of global economic downturn, Indian companies need to manage their cash better as they are putting double the amount of their profits into inventories and receivables, a survey says.
Besides, cash investment in net working capital also exceeded their total net profit of these companies in 2007-08, according to a survey of 80 companies by global management consulting firm Booz & Co.
At the end of FY2008, the 80 companies studied had about Rs 330,000 crore blocked in inventory and receivables and about Rs 150,000 crore in net working capital.
The total cash invested in the working capital of 80 firms is in 2007-08, was Rs 130,000 crore.