AN EMPIRICAL STUDY ON PROFITABILITY AND LIQUIDITY ANALYSIS OF MSMEs

Micro, Small, and Medium Enterprises (MSMEs) play a crucial role in the economic development of India by contributing to employment generation, industrial output, and exports. The financial health of MSMEs is largely determined by their profitability and liquidity positions. This study aims to analyze the profitability and liquidity of selected MSMEs using empirical data. Profitability reflects the earning capacity of enterprises, while liquidity indicates their ability to meet short-term obligations. The study is based on both primary and secondary data and employs ratio analysis and percentage analysis as key tools. The findings reveal that while MSMEs maintain moderate profitability levels, many face challenges in maintaining adequate liquidity. The study highlights the need for efficient financial management and improved access to finance to ensure the sustainability of MSMEs.