The purpose of this paper is to analyze the financial stabilization in the context of selected companies and to find out whether it is optimal. The petroleum industry is the backbone of our Indian economy. This analysis has done regarding selected petroleum companies during the period of 2012-13 to 2016-17. The financial stabilization has a very important place in the scheme of financial planning of an enterprise. The main objective of financial management is to maximize the shareholder`s wealth and other is maximization of profit. Financial stabilization is a situation in the financial system, major financial markets and financial institutional systems are resistant to economic shocks and fit to carry out their basic functions smoothly: arbitrage of financial funds, management of risks and payment arrangements. In other words financial stability is a property of a financial system that eliminates financial imbalances that arise in financial markets or as a result of significant adverse and unforeseen events. When stabilized, the system absorbs economic shocks primarily through self-corrective mechanisms, preventing adverse events from disrupting the real economy or spreading to other financial systems. Financial stability is paramount for economic development, as most transactions in the real economy are done through the financial system. Without financial stability, banks are hesitant to complete financing of profitable projects, asset prices may deviate more than their real values, and deviate from the payment settlement schedule criteria.

KEYWORDS:  Financial Stabilization, Financial Stability and Crises, Financial Management.