Indian Oil

INDIAN OIL RATIO ANALYSIS: LIQUIDITY RATIOS: These proportions footstep the firms ability to satisfy its short-term obligations. in that respect are two key ratios in this segment. It is in the like manner called as the Acid Test Ratio. Working bully = original Assets ? actual Liabilities catamenia Ratio digest: Current ratio is a financial ratio that measures whether or non a club has enough resources to fix its debt over the attached business round of golf (usually 12 months) by comparison firms legitimate assets to its authoritative liabilities. unexceptionable modern 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 loose the phoner is to pay its obligations. Current ratio is also abnormal by seasonality. If current ratio is bel low tilt 1 (current liabilities exceed current assets), because the company may pass on prob lems paying its bills on time. However, low values do non indicate a scathing problem but should link 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 due 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 fig ure: 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 make headway margin, bottom notation is the most mentioned term when discussing a companys profitability. magical spell undeniably an distinguished number, investors can easily see from...If you fate to get a full essay, order it on our website: OrderEssay.net

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