Assessment of profitability and inventory management in the Nigerian power generation asset companies

In Nigeria’s electricity sector, there are numerous energy generation firms (GenCos). These companies are responsible for the generation of electricity for millions of clients around the country. These companies often face significant inventory management issues despite the high electricity demand. These inefficiencies can result in both financial losses and operational disruptions, which negatively impact these businesses’ overall profitability. Additionally, this study will look into how inventory management affects revenue generation, operational costs, and overall financial sustainability. Three generation firms were selected to represent Nigeria’s energy industry in the dataset. Mainstream Energy Solutions Limited, Transcorp Power Limited, and Egbin Power PLC are some of the companies. Important elements needed to assess inventory management practices and their impact on profitability in Nigeria’s oil industry are contained in the dataset. The following variables are used: year, city, location, cash flow, revenue, capital cost, and operating cost. Regression analysis, sensitivity analysis, and Data Envelope Analysis (DEA) were used to examine inventory management and its impact on profitability in the Nigerian energy sector. According to the analysis, there is a lot of pressure on businesses in Nigeria’s energy sector to efficiently control costs to stay profitable.