WORKING CAPITAL MANAGEMENT AND FIRM'S VALUE OF LISTED PHARMACEUTICAL FIRMS IN NIGERIA

Working capital reflects how the company operates on a daily basis and relates to the investment of the company in short-term assets. This study examines the impact of working capital management (WCM) on the firm value of listed pharmaceutical firms in Nigeria from 2007 to 2022. Using annual financial statements as secondary data, the study analyzes key WCM indices Cash Conversion Cycle (CCC), Average Collection Period (ACP), Average Payment Period (APP), and Inventory Conversion Period (ICP)and their influence on firm value, measured by Tobin's Q. Panel regression, correlation, and descriptive statistics were employed to analyze the data. The results indicate that APP (t-stat -2.79, pvalue 0.00) and CCC (t-stat -2.41, p-value 0.01) negatively affect firm value, while ICP (t-stat 4.04, pvalue 0.00) has a positive impact. ACP (t-stat 1.26, p-value 0.21) was found to be insignificant. The study concludes that CCC, APP, and ICP are key indicators for improving firm value and recommends strategies to reduce CCC by speeding up receivables collection (ACP), managing inventory efficiently (ICP), and extending payment periods (APP).