Comparative of Financial Performance: Traditional Finance Vs Sustainable Finance Companies In India

Abstract

This study investigates the financial performance of traditional finance companies compared to their sustainable counterparts. By analyzing key financial ratios, it dissects the differences in their growth trajectories, profitability, liquidity, debt structures, operational efficiency, and valuation. The reveals a promising outlook for sustainable companies. They exhibit consistent sales growth, demonstrate improving profitability through efficient cost management and asset utilization, and prioritize long-term, sustainable growth. In contrast, traditional finance companies often prioritize short-term gains, leading to greater fluctuations in profitability and liquidity. This can be exacerbated by potentially riskier financial structures with higher debt levels. These findings suggest a potential trade-off between shortterm profit maximization and long-term sustainability in traditional companies. It is important to acknowledge the limitations of this . The sample size is restricted, and a more comprehensive understanding would require incorporating a broader data set, industry benchmarks, and a deeper exploration of the companies' specific sustainability practices. Examining these factors alongside the financial ratios would provide a clearer picture of how these practices translate into financial performance. Additionally, qualitative factors such as management quality, future growth prospects, and the evolving regulatory landscape would offer valuable insights. This study highlights the potential benefits of sustainable financial practices for a company's long-term financial health. While traditional companies may prioritize short-term gains, sustainable companies appear to be on a promising trajectory, balancing profitability with environmental and social impact. Further research, incorporating a broader data set and qualitative factors, is recommended to gain a deeper understanding of the complex relationship between financial performance and sustainability practices.