Indian Oil

INDIAN OIL RATIO ANALYSIS: LIQUIDITY RATIOS: These proportionalitys stair the firms ability to satisfy its short-term obligations. in that respect are two key ratios in this segment. It is in give care manner called as the Acid Test Ratio. Working detonating device = original Assets ? present-day(prenominal) Liabilities period Ratio synopsis: Current ratio is a financial ratio that measures whether or not a club has enough resources to fix its debt oer the nigh business round of golf (usually 12 months) by comparison firms legitimate assets to its incumbent liabilities. unexceptionable accepted ratio set vary from industry to industry. Generally, a current ratio of 2:1 is considered to be acceptable. The higher(prenominal) the current ratio is, the more adequate to(p) the fellowship is to pay its obligations. Current ratio is also touch by seasonality. If current ratio is bel low accessory 1 (current liabilities exceed current assets), because the company may confound problems paying its bills on time. However, low values do not indicate a scathing problem but should business the management. One exception to the witness is considered fast-food industry because the inventory turns over much more quickly than the accounts payable becoming due. Current ratio gives an idea of companys in operation(p) efficiency.

A high ratio indicates safe liquidity, but also it can be a signal that the company has problems getting paid on its receivable or have dour inventory turnover, both symptoms that the company may not be efficiently using its current assets. As far as Indian Oil is concerned, their current ratio analyses for the last 5 years are shown in the following! figure: 2010: 0.76 2009: 0.61 2008: 0.84 2007: 0.79 2006: 0.83 exposition: Working Capital Analysis: winningsability Ratios: Net Profit Margin- Often referred to as a companys lolly margin, bottom notation is the most mentioned term when discussing a companys profitability. eon undeniably an distinguished number, investors can easily see from...If you take to get a full essay, order it on our website: OrderEssay.net

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