RELEVANCE OF WORKING CAPITAL MANAGEMENT IN SOFTWARE COMPANIES IN KERALA

Information technology is playing an important role in India today and has transformed India's image from a slow moving bureaucratic economy to a land of innovative entrepreneurs. Financial performance of IT companies is driven by factors such as digitisation, and non-linear models, and the depreciation of the Indian rupee. Indian IT firms continue to move up the value chain by providing more end-to-end solutions and engaging more closely with clients. The drive towards digital technologies, internal cost optimisation to improve profitability continued in FY16. Digital revenues grew 1.5 times faster than revenues from traditional services. India's IT industry can be divided into six main components, viz. Software Products, IT services, Engineering and R&D services, ITES/BPO (IT-enabled services/Business Process Outsourcing), Hardware, and e-commerce. Export revenues (US$ 61 billion) continue to drive growth. Working capital management is very essential to maintain liquidity in the organization. Hence this study will reveal to the management of the organization regarding the position of working capital and how well to manage it.