Current ratio

Current assets divided by current liabilities. A crude measure of whether short-term obligations are covered by short-term resources.

Take a distributor with ₹1,775 crore of current assets and ₹1,005 crore of current liabilities. It scores 1.77.

As a rule, the textbook comfort level of two times is close to useless. A supermarket runs below one and is perfectly safe because it collects cash daily; a capital-goods maker at two may be carrying inventory nobody wants. It counts assets by their accounting classification, and whether they can actually be turned into cash this month never enters it.

Use it as a starting question, then go and look at the ageing schedules.