Advances in Consumer Research
Issue 2 : 822-826
Original Article
Long-Term Solvency And Financial Performance An Empirical Study Of Reliance Industries Ltd
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Assistant Professor Department of Commerce & Management, Guru Nanak College, Budhlada
Abstract

One of the important determinants of the financial stability of a firm and the ability to meet the long term liabilities is the long-term solvency. A balanced capital structure is the sole alternative of profitability and the minimization of financial risk in case of capital-intensive and diversified corporations. This essay is the long-term solvency and financial performance of Reliance Industries Ltd analysis of Reliance industries Ltd in the years 2021-2024 using secondary data. The solvency ratios that were considered as critical are the debt-equity ratio, interest coverage ratio and total assets to debt ratio, and the profitability ratios, which are the return on assets and net profit margin. Ratio analysis and graphical trend-based analysis are used to determine the impact of the solvency management on financial performance. The findings show that the stages of increased solvency levels are associated with increased profitability, but high leverage creates a burden on the profit. The study illustrates the importance of good debt management and good capital structure as far as long-term financial sustainability is concerned..

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