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Impact of liquidity and financial leverage on firm's profitability – an empirical analysis of the textile industry of Pakistan

Research journal of textile and apparel, 2019-12, Vol.23 (4), p.291-305

Copyright Emerald Group Publishing Limited Dec 2019 ;ISSN: 1560-6074 ;EISSN: 2515-8090 ;DOI: 10.1108/RJTA-09-2018-0055

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  • Title:
    Impact of liquidity and financial leverage on firm's profitability – an empirical analysis of the textile industry of Pakistan
  • Author: Samo, Asif Hussain ; Murad, Hadeeqa
  • Subjects: Business ; Capital structure ; Clothing industry ; Corporate profits ; Decision making ; Developing countries ; Empirical analysis ; Employment ; Financial leverage ; Financial statements ; Financing ; Industrialized nations ; Investment ; Investments ; LDCs ; Manual workers ; Profit margins ; Profitability ; Raw materials ; Textile industry ; Working capital
  • Is Part Of: Research journal of textile and apparel, 2019-12, Vol.23 (4), p.291-305
  • Description: Practical implications - This study can help higher management of textile firms firm in decision-making stating clearly about how to perform well to enhance financial health of company, which can encourage investors to invest in companies having sound market standing. The clothing industry is labor intensive, and it offers entrylevel occupations for unskilled workers in both developed and developing nations. [...]both are very important for increasing the profitability of a company. 1.2Research problem There are various factors that can impact the profitability of the business, among which liquidity and leverage are ones (Karaduman et al., 2010) that can affect the profitability of some specific industries or sectors, but the impact may differ according to the nature of the business and industry. Pakistan's textile sector is also challenged in the area of capital composition and, because of this noneffective selection of financing modes, the operations and performance of textile firms are negatively impacted. 2.1Profitability of firms The concept of profitability is to assess the ability of business for the generation of excess worth out of investment compared to costs incurred during a specific period (Shaheen, 2012).
  • Publisher: Hong Kong: Emerald Group Publishing Limited
  • Language: English
  • Identifier: ISSN: 1560-6074
    EISSN: 2515-8090
    DOI: 10.1108/RJTA-09-2018-0055
  • Source: ProQuest Central

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