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Smart Money

Glossary

What is Current ratio?

The current ratio divides current assets by current liabilities: a measure of a company's ability to meet its bills over the next year.

Above 1× means short-term assets (cash, receivables, inventory) exceed obligations due within a year. Very high ratios can mean idle cash or slow-moving inventory.

Formula

Current ratio = current assets ÷ current liabilities

Current ratio on the Pakistan Stock Exchange

Across 433 listed companies with the figure, the median is 1.25×.

Current ratio of the largest PSX companies
Largest companiesCurrent ratio
PIAHCLB PIA Holding Company LimitedB 0.38×
OGDC Oil & Gas Development Company Limited 8.03×
FFC Fauji Fertilizer Company Limited 1.27×
MARI Mari Energies Limited 2.66×
PPL Pakistan Petroleum Limited 4.53×