Determinant of Profitability in Indian Cement Industry:An Economic Analysis

Efficiency of any organization can be judge through its profitability. Profitability of the firm is highly influenced by internal and external variables, i.e., size of organizations, liquidity management, growth of organizations, component of costs and inflation rate. In the present paper an attempt has been made to identify which variable are judging the profitability of Indian Cement Industry. The study covers the all listed cement firms working in India for the period of 2001 to 2008. To determinant profitability backward regression analysis were used on the variables of the study. The result of the study shows that liquidity, age of the firm, operating profit ratio, interest rate and inflation rate has played a vital role in the determination of the profitability of Indian Cement Industry.