A STUDY ON PROFITABILITY OF SELECT PHARMACEUTICAL COMPANIES IN INDIA BASED ON GROSS PROFIT MARGIN – A MULTIPLE REGRESSION APPROACH

The researcher examined the Gross profit margin on select pharmaceutical companies using a Multiple Regression approach. In this study the Gross Profit Margin is predicted based on the four Independent variable such as Inventory Turnover Ratio (ITR), Debtors Turnover Ratio (DTR), Creditors Velocity (CRSV) and Total Asset Turnover Ratio. Based on 2013-14 survey leading pharmaceutical companies', the first 5 companies is identified for this study were Cipla Pharmaceutical Limited, Dr. Reddy's Lab, Glasko Smithline Pharmaceutical Limited (GSK), Lupin Pharmaceutical Limited and Sun Pharmaceutical Limited. The objectives of the study are the Gross Profit Margin of select pharmaceutical companies in India using Multiple regression approach. To study the relationship between the Inventory turnover ratio, Debtors turnover ratio, Creditors velocity and Total asset turnover ratio with Gross profit margin. To determine the profitability based on Gross profit margin of selected Indian pharmaceutical companies such as Cipla, Dr. Reddy, GSK, Lupin and Sun pharma. To determine the GPM 10 yrs (2004-2013) of data were collected from annual report of the respective companies. Thus the four dimensions ITR, DTR, CRSV and TATR creates impact towards GPM the researcher adopted multiple regressions modeling with the help of statistical package for social science (SPSS) Package. V.20.