Name: Cash Ratio

Definition: The cash ratio measures a company's ability to pay off all of its current liabilities immediately using only its most liquid assets: cash and cash equivalents. Unlike the current ratio and quick ratio, it excludes accounts receivable and inventory, making it the most conservative measure of liquidity.

Interpretation:
• In '2021', ERII's cash ratio was 3.76, indicating the company's ability to meet short-term obligations purely with cash. Industry average for Industrial Machinery/Components in '2021' stood at 1.39.
• In '2022', ERII's cash ratio was 3.08, indicating the company's ability to meet short-term obligations purely with cash. The decline from '2021' may indicate some operational or financial challenges. Industry average for Industrial Machinery/Components in '2022' stood at 1.12. Industry average declined by 0.27 from previous year.
• In '2023', ERII's cash ratio was 3.17, indicating the company's ability to meet short-term obligations purely with cash. The increase since '2022' reflects strengthening financial performance. Industry average for Industrial Machinery/Components in '2023' stood at 0.96. Industry average declined by 0.16 from previous year.
• In '2024', ERII's cash ratio was 1.26, indicating the company's ability to meet short-term obligations purely with cash. The decline from '2023' may indicate some operational or financial challenges. Industry average for Industrial Machinery/Components in '2024' stood at 0.95. Industry average declined by 0.02 from previous year.
Overall, ERII's cash ratio has been volatile but showed a downward trend over the past 4 years.

Formula: Cash Ratio = (Cash + Cash Equivalents) / Current Liabilities

Good Range: Generally, a cash ratio between 0.2 and 0.5 is considered healthy for most industries.