ExlService Holdings Inc (EXLS)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	153,355	136,953	118,669	135,337	218,530
Short-term investments	US$ in thousands	187,223	153,881	179,027	179,430	184,286
Total current liabilities	US$ in thousands	290,116	326,403	277,946	495,686	221,078
Cash ratio		1.17	0.89	1.07	0.64	1.82

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($153,355K + $187,223K) ÷ $290,116K
= 1.17

The cash ratio of ExlService Holdings Inc has shown some fluctuation over the past five years. It stood at 1.82 on December 31, 2020, indicating that the company had $1.82 in cash and cash equivalents for every $1 of current liabilities. However, this ratio decreased to 0.64 by the end of 2021, which could suggest a potential liquidity challenge as the company had less cash available to cover its short-term obligations.

The cash ratio then improved to 1.07 by the end of 2022, indicating a better ability to meet its current liabilities with available cash. However, the ratio declined slightly to 0.89 by the end of 2023, potentially signaling a decrease in liquidity levels compared to the previous year. Nonetheless, the ratio increased to 1.17 by the end of 2024, reflecting an improved cash position relative to short-term obligations.

Overall, while the cash ratio experienced fluctuations, it is essential for ExlService Holdings Inc to maintain a healthy balance between cash reserves and current liabilities to ensure sufficient liquidity for operational needs and financial stability.