India depends on coal industry to grow its economy. Massive investments in coal mining are required in order to enhance a stable energy supply. Effective management of assets enhances efficiency of capital investment, financial performance, and is critical in encouraging investing activities in the industry. This paper examines the correlation between asset management and financial performance of both the publicly and privately owned coal companies in Jharkhand, India, to elucidate the relationship of asset management in the industry and to find out whether ownership type influences asset management efficiency and its performance.

This study uses a panel econometric model to investigate a rich data set of Jharkhand coal companies which had been in operation between 2013 and 2021. An input-oriented non-parametric technique is a technique of estimating the efficiency of asset management as a relevant firm-specific proxy. The financial performance is evaluated based on the liquidity, profitability and productivity indicators. Capital structure, governmental assistance, operational sustainability among other firms-specific factors vary immensely between public and private firms in the Jharkhand coal industry and this requires the two types of ownership structures to be compared as a way of explaining the significance of asset management.

The process of asset management can be perceived as the increase of the efficiency of capital investment and use in and use of both fixed and current assets . However, the precise definition is quite diverse in the available literature, so it is impossible to find a single consistent theoretical framework. As reported by Zheng et al. two applicable dimensions in the decision-making situation are efficiency in capital investment with the goal of enhancing future revenue and efficiency in assets utilization with the aim of enhancing turnover. In the specifics of industry, the physical essence of the coal resources presupposes fewer opportunities of adjustment and changes in the utilization, which limits the scope of adoption to the turnover of assets. Extra financial resources, governmental assistance, and state-sponsored infrastructural investment enhance access to capital in the public companies and promote their functioning and developmental opportunities; whereas the political guidance to the government sector and the subsidy supply tends to reduce the quality of services and productivity in the context of the private companies)