A Study of Risk and Return Investment Valuation for Working Capital Management at BHEL

Abstract

This study focuses on the analysis of risk and return investment valuation in relation to working capital management at Bharat Heavy Electricals Limited (BHEL). Working capital management plays a significant role in maintaining liquidity, operational efficiency, and profitability in manufacturing organizations. The study aims to evaluate how effective management of current assets and current liabilities influences investment decisions, risk exposure, and returns within the organization. The research is based on secondary data collected from annual reports, financial statements, journals, and company records of BHEL for a selected period. Financial tools and techniques such as ratio analysis, trend analysis, working capital turnover ratio, current ratio, quick ratio, and profitability ratios are used to assess the company’s financial performance. The study also examines the relationship between risk and return in investment valuation and its impact on efficient utilization of working capital resources. The findings reveal that efficient working capital management contributes positively to maintaining liquidity and enhancing profitability, while poor management may increase financial risk and affect operational stability. The study concludes that balancing risk and return through proper investment valuation and effective working capital practices is essential for improving the financial performance and long-term sustainability of BHEL. The research provides useful insights for management, investors, and financial analysts in understanding the importance of working capital decisions in large-scale industrial organizations.