The impact of financial management on the companies performance: Analytical study on medications manufacturing companies

The subject of financial management has mainly three activities which have to deal with namely financing activity, investment activity, and dividend distribution activity. For financing decisions, the study analyzed the debt-equity ratio. For a short-term investment, the study analyzed current ratios (CR), quick ratios (QR), and working capital turnover ratios (WCTR). For dividend decisions the study analyzed earnings per share ratio (EPS) and dividend per share (DPS). The key objective of the study is to analyze the effect of financial management on companies' performance with all selected ratios of financial management considered as explanatory variables and return on assets (ROA) considered as a response variable. The study sample contained four selected companies provide offer their medical products and services to Arab countries. The study depends on period starting from 2012-13 to 2021-22. For the identification of differences among financial management ratios for sample companies, the one-way Anova test was used. Correlation analysis has been used to identification of an association between independent variables and dependent variable. The impact has been checked by a panel data analysis regression model for each selected companies. The study concluded that there is a discrepancy in the financial ratios among selected companies within the study period except for DPS and WCTR. The study further found that while financial management has no effect on the performance of the Aurobindo and Cipla companies, it has an impact on the performance of the Biocon and Wockhardt companies.