Impact of Energy Crisis on the Financial Performance of Textile Sector, Listed on Karachi Stock Exchange, A Time Series Analysis (2007-2014)

Author(s)

Bilawal Ali Soomro , Faheem-ul-Hussain Dehraj , Abdul Naveed Tariq , Zaheer Abbas Awan ,

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Volume 8 - September 2019 (09)

Abstract

Energy serves an important role in the financial performance of textile industry. This research ascertains the relationship between electricity consumption and financial performance of textile industry of Pakistan after energy crisis, based on the sample data taken for the period of 2007-2014. Electricity consumption is taken as independent variable and ROA, ROE and NPM as considered the dependent variables. Data was analyzed through descriptive statistics and regression tests. Descriptive statistics confirms the declining trend in the financial performance ratios while regression test shows significant positive strength of relationship among dependent and independent variables. This study identifies how important electricity consumption is for the financial performance of textile industry therefore Government of Pakistan should focus on utilization of alternative energy resources and shift from oil usage to hydro energy which has higher resources available which in turn will smooth the way for financial performance and economic growth

Keywords

Energy consumption, ROA, ROE, NMP, Financial Performance

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