Financial ratios simplify complex financial statements and allow quick comparisons across companies or time periods. This module covers essential ratios like liquidity ratios (current ratio, quick ratio), profitability ratios (ROE, ROA, net margin), leverage ratios (debt-equity), and efficiency ratios (inventory turnover, asset turnover). These metrics help you evaluate a company’s operational performance, financial health, and profitability. We’ll explain the formulas, what each ratio signifies, and what’s considered a good or bad value. You’ll learn how to benchmark ratios against industry averages and spot warning signs in underperforming companies. Practical exercises with real balance sheets and income statements from Indian companies will strengthen your ratio analysis skills. This lesson also guides you on integrating ratios into stock screening tools and investment frameworks. Mastering financial ratios is essential for identifying high-potential stocks, avoiding bad investments, and making informed, data-backed decisions in both short- and long-term trading strategies.