The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. It is calculated as a company's Total Current Assets excludes Total Inventories divides by its Total Current Liabilities. Essar Energy's quick ratio for the quarter that ended in Mar. 2013 was 0.38.
Essar Energy has a quick ratio of 0.38. It indicates that the company cannot currently fully pay back its current liabilities.
The historical rank and industry rank for Essar Energy's Quick Ratio or its related term are showing as below:
LSE:ESSR'
s Quick Ratio Range Over the Past 10 Years
Min: 0.37 Med: 0.38 Max: 0.78
Current: 0.38
During the past 3 years, Essar Energy's highest Quick Ratio was 0.78. The lowest was 0.37. And the median was 0.38.
LSE:ESSR's Quick Ratio is not ranked
in the Oil & Gas industry.
Industry Median: 1.1
vs LSE:ESSR: 0.38
Essar Energy Quick Ratio Historical Data
The historical data trend for Essar Energy's Quick Ratio can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Essar Energy Quick Ratio Chart
Essar Energy Annual Data
Trend
Dec09
Dec10
Mar13
Quick Ratio
0.37
0.78
0.38
Essar Energy Semi-Annual Data
Dec09
Dec10
Mar13
Quick Ratio
0.37
0.78
0.38
Competitive Comparison of Essar Energy's Quick Ratio
For the Oil & Gas Refining & Marketing subindustry, Essar Energy's Quick Ratio, along with its competitors' market caps and Quick Ratio data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Essar Energy's Quick Ratio Distribution in the Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Essar Energy's Quick Ratio distribution charts can be found below:
* The bar in red indicates where Essar Energy's Quick Ratio falls into.
Essar Energy Quick Ratio Calculation
The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. For this reason, the ratio excludes inventories from current assets.
Essar Energy's Quick Ratio for the fiscal year that ended in Mar. 2013 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Essar Energy (LSE:ESSR) Quick Ratio Explanation
The quick ratio is more conservative than the Current Ratio because it excludes inventories from current assets. The ratio derives its name presumably from the fact that assets such as cash and marketable securities are quick sources of cash. Inventories generally take time to be converted into cash, and if they have to be sold quickly, the company may have to accept a lower price than book value of these inventories. As a result, they are justifiably excluded from assets that are ready sources of immediate cash.
In general, low or decreasing quick ratios generally suggest that a company is over-leveraged, struggling to maintain or grow sales, paying bills too quickly or collecting receivables too slowly. On the other hand, a high or increasing quick ratio generally indicates that a company is experiencing solid top-line growth, quickly converting receivables into cash, and easily able to cover its financial obligations. Such companies often have faster inventory turnover and cash conversion cycles.
The higher the quick ratio, the better the company's liquidity position.
Essar Energy Quick Ratio Related Terms
Thank you for viewing the detailed overview of Essar Energy's Quick Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
Essar Energy plc is incorporated in United Kingdom. It is a holding company. The business activities of the Group of which it is the parent are those of an India-focused energy company with assets across the power and oil and gas industries. The Group comprises four operating divisions are Refining and Marketing India, Refining and Marketing UK, Exploration and Production, Power Generation and Transmission. Refining and Marketing India owns a petroleum refinery on the west coast of India, together with a 50% interest in a petroleum refinery in Kenya, and oil retailing stations on franchise across India. Its products are high speed diesel, motor spirit, fuel oil and superior kerosene oil. The activities of Refining and Marketing include the refining of crude oil and trading, marketing and transportation of finished products and by-products. Refining and Marketing UK products include high speed diesel, motor spirit, fuel oil and superior kerosene oil. The activities of Refining and Marketing include the refining of crude oil and trading, marketing and transportation of finished products and by-products. Exploration and Production has a diverse portfolio of 15 blocks for the exploration and production of oil and gas in India, Indonesia, Madagascar, Nigeria and Vietnam. Power segment operates gas and liquid fuel-based power plants in India and Canada together with a number of mining assets. Corporate comprises Essar Energy plc and its subsidiary companies that provide services to the Group as a whole.
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