Dorian LPG Ltd (LPG)
Cash conversion cycle
| Mar 31, 2025 | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 4.47 | 5.11 | 4.54 | 4.33 |
| Days of sales outstanding (DSO) | days | 1.40 | 34.51 | 54.91 | 75.06 | 65.15 |
| Number of days of payables | days | — | 19.02 | 21.54 | 22.26 | 21.33 |
| Cash conversion cycle | days | 1.40 | 19.96 | 38.49 | 57.35 | 48.15 |
March 31, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 1.40 – —
= 1.40
The cash conversion cycle of Dorian LPG Ltd has shown fluctuations over the past five years. As of March 31, 2021, the company's cash conversion cycle was 48.15 days, indicating the average number of days it takes for the company to convert its investments in inventory and accounts receivable into cash.
Over the years, the trend in the cash conversion cycle has varied. By March 31, 2022, the cycle increased to 57.35 days, reflecting a potential delay in converting investments into cash. However, by March 31, 2023, the cycle decreased significantly to 38.49 days, suggesting an improvement in efficiency in managing working capital.
The most drastic change occurred by March 31, 2024, where the cash conversion cycle reduced to 19.96 days, indicating a sharp improvement in the company's ability to convert its resources into cash more efficiently. By March 31, 2025, the cycle further decreased to just 1.40 days, highlighting a remarkable efficiency in managing working capital and swiftly converting investments into cash.
Overall, while there have been fluctuations, Dorian LPG Ltd has demonstrated an overall positive trend in optimizing its cash conversion cycle over the five-year period, indicating improved efficiency in working capital management.