Profitability Analysis Of Hindustan Petroleum Corporation Limited

Journal Name: 
Journal of Banking, Information Technology & Management
Vol. 14 - No. 2
Author Name Designation Organization
Gurneet Mokha

According to Hermanson Edward and Salmonson, "Profitability is the relationship of income to some balance sheet measure which indicates the relative ability to earn income on assets employed." (Hermanson, 1983)
Profitability basically indicates the efficiency of the business. It is the ability of the firm to earn profits from all the activities and the operations of the business are carried out on the basis of profitability. It also tells how the business is utilizing its resources in an efficient manner. Profitability is the earning capability of the business. It is very important for a business to increase its earnings so as to continue its operations. The capability to earn is also known as the "earning performance of the business". So it is always better for a business to have high profitability.