ANALYSIS OF SELECTED AUTOMOBILE COMPANIES IN INDIA BY USING ALTAMIN Z SCORE

Transcription

1 ANALYSIS OF SELECTED AUTOMOBILE COMPANIES IN INDIA BY USING ALTAMIN Z SCORE M.S. Prathibha Raj 1, Dr. G Dinakar 2 Abstract: This paper is an attempt to analyze selected automobile companies with the help of altamin Z score. The Altman Z score is an empirical model that predicts the probability of corporate insolvency. It is a financial tool through which the company s financial performance can be studied, particularly about the liquidity position of companies. It can also be called as predictor of financial distress. Eight automobile companies are selected for this study. Companies which is having Z score which is less than 1.8 is it is said to be bankrupt, As per analysis Atul Auto and Hindustan Motors have week Z score, they are safe as per my analysis but when compared to its peers it is worst performer, In simple these two companies should work on fundamentally. As per analysis, Eicher Motors have very good score highest of its peers. Eicher motors should tap rural market and open new stores in overseas. So, it is eminent from the analysis Atul Auto and Hindustan Motors are worst performers and Eicher motors is the best. Individuals in the interest of the investors who invest their money in stock market, it may be Institutional investors or I could be a professional. Investing in those companies which is having very poor credit worthiness and which tends to bankrupt in future does not make any sense. Apart from Altman Z score Analysis there are many other tools which individuals should consider. Apart from investment point of view individuals can understand the company s financial health. It is one of the parameters to understand the performance of company in long term. The application of financial instability can be measured by using Altman Z score. It is evident that research done by others is 80% true. This research can be done by individual, Institution or professionals etc. Altman Z score is an analysis which can be done easily by referring to the financial statements of companies. Altman Z score holds good only for listed companies in stock exchange. 37

2 INTRODUCTION The Indian automobile manufacturing is one of the major in the world. This industry accounts for 7.1 per cent of the country's Gross Domestic Product (GDP). As of FY , around 31 per cent of small cars sold globally are manufactured in India. The Two Wheelers segment with 81 per cent market share is the leader of the Indian Automobile market owing to a growing middle class and a young population. Moreover, the growing interest of the companies in exploring the rural markets further aided the growth of the sector. The overall Passenger Vehicle (PV) segment has 13 per cent market share. India is also a prominent auto exporter and has strong export growth expectations for the near future. In April-January 2016, exports of Commercial Vehicles registered a growth of per cent over April-January In addition, several initiatives by the Government of India and the major automobile players in the Indian market are expected to make India a leader in the Two Wheeler (2W) and Four Wheeler (4W) market in the world by India is home to a vibrant automobile of more than 40 million vehicles. It has been one of the few worldwide which saw growing passenger car sales during the recession of the past two years. In fact, in it has recorded its highest volumes ever. It is believed this upward trend will be sustained in the foreseeable future due to a strong domestic market and increased thrust on exports. The Indian economy has grown at an average rate of around 9 % over the past five years and is expected to continue this growth in the medium term. This is predicted to drive an increase in the %age of the Indian population able to afford vehicles. India s car per capita ratio (expressed in cars per 1,000 populations) is currently among the lowest in the world s top 10 auto markets. The twin phenomena of low car penetration and rising incomes, when combined with increasing affordability of cars, are expected to contribute to an increase in India s automobile demand. The automotive industry is one of the key drivers of India s economy, accounting for around 4 % of India s GDP1 and over 200,000 jobs. It is also a focus area for globally. I regularly publish reports on client industries including the automotive sector. This study which is focused on the Indian market contains insights from two such global reports, the I Global Auto Executive Survey 2010 and Brand & Ownership Concentration in the European Automotive Industry. It analyses data and examines three emerging themes within the Indian context: Growth and consolidation Green revolution Mobility revolution for this study MARKET SIZE The auto industry produced a total million vehicles in April-January 2016, including passenger vehicles, commercial vehicles, three wheelers and two wheelers, as against million in April-January

3 Domestic sales of Passenger Vehicles grew by 8.13 per cent in April-January 2016 over the same period last year. Within the Passenger Vehicles, Passenger Cars rose by per cent, during April-January 2016 over April-January The domestic sales of Commercial Vehicles increased by 9.43 per cent in April-January 2016 over the same period last year. Sales of Medium & Heavy Commercial Vehicles (M&HCVs) increased at per cent. THEORITICAL BACKGROUND OF THE STUDY This dessertation is done to concentrate more on value investing. Both from industry point of view and indivisual point of view. This would also help professionls like Certified Financial Planners, Wealth Advisers and other Financial instrument seller. So lets get back to the history of Altman Z Score. INTRODUCTION TO ALTMAN Z Let us ask ourselves a question, What is Altman s Z score? Altman s Z is a statistically derived predictive model used to analyze and forecast the firm s impending insolvency (Moyer, 2005). In 1968, Edward Altman, a well known financial economist and professor at New York s Stern School of Business, derived this model The Altman Z score is an empirical model that predicts the probability of corporate insolvency. It is a tool which helps to predict the company s financial performance with respect to the liquidity of the company. The dissertation stress on how to calculate the probability of corporate insolvency in future. It can also be called as predictor of financial distress. The Altman Z score was initially published in the year 1968 by Professor Edward Altman, which tries to measure a company s financial health. At original research which is piloted by Edward Altman, he chose 66 corporations which is listed in stock exchange (half of those corporations is doing well and half of corporations went bankrupt). Altman then observed several similar financial ratios based on data retrieved from annual financial reports. After linearly combining these ratios, Altman arrived at an empirical equation (called the Z-Score) that predicted the risk of corporate failure within two years with an accuracy of 72%, and false-positives at 6% BENEFICIARIES OF ALTMAN Z Financial Institutions Individuals Investor in Financial instruments Foreign Investors Professionals like CFP, FP and Analyst etc. STATEMENT OF PROBLEM Most of the time Investors get effected by market sentiments so fundamentally good companies will not be effected by this and business model of companies should be strong and Investing in those companies brings fortune to investors. 39

4 The biggest calamity that all equity investors experience is corporate bankruptcy, which takes out the equity of the firm which results in decrease in the value of investment in stock. Some of the fundamental analysis tries to measure the performance of the stock or company but this is not enough. Financial ratios can often help us to paint the picture of long term viability of companies, but again this is not enough. SCOPE OF THE STUDY Bankruptcy of a company pose risk to both equity as well as debt investors. The Company can overcome its shortcomings through the analysis of its propensity to bankruptcy. Altman Z score is such a tool which predicts potential bankruptcy of Companies. By doing this analysis we will come to know regarding Operating Risk and High Financial Leverage Risk of a particular company. In turn it will help us to predict potential bankruptcy of the companies analysed. This dissertation mainly concentrated on the phenomenon of bankruptcy prediction from the developing country like India, using Altman Z score. This dissertation is purely based on analysis of different Automobile company listed in both Nation Stock Exchange and Bombay Stock Exchange, we have taken both the stock exchange because some of the companies aren t listed in both the stock exchanges for example if X company is listed in National Stock Exchange, so to get the good number of companies we have considered both the exchanges for doing the analysis. After doing this simple analysis the investors in particular stock we are able to assess the probability bankruptcy. I t is evident that people usually try to invest in those companies which has cash cow business or whose marketing strategies so influencing that makes people to invest in the company. Few people try to do analysis of company and invest in it. OBJECTIVES Predicting possible financial distress of companies. To help companies work on their core business and create value for investors. To helps Investors in decision making. To predict future performance of company. SAMPLING Initial sample is composed of number of automobile companies in India. Balance sheet and Income statement are my Variable Selection. Many data will be readily available in Bombay Stock Exchange website and Balance sheet of the companies. We have not taken those companies whose financial statements are not published for least two years, because they would not able to be tested in Altman s model. This, however, created a bias against new firms. Earlier Altman Z score selected twenty two financial ratios on the basis of the popularity in literature and there potential relevancy to bankruptcy prediction. At last he filtered to five important ratios. 40

5 COMPANIES SELECTED FOR ANALYSIS Where Z is 2.7 to 3.0, the company is probably safe from bankruptcy, but this WHAT IS ALTMAN Z-SCORE?? Altman Z-Score is a quantitative balancesheet method of determining a company's financial health. Safe companies, i.e. companies that have a low probability of bankruptcy, have an Altman Z-Score greater than 3.0.The Altman Z-Score is a measure of a company's health and likelihood of bankruptcy. Several key ratios are used in the formulation of an Altman Z-Score Value. The Z-Score model is the 1960's brainchild of Professor Edward Altman of NYU. The Z score consists of five variables X1 = Working Capital / Total Assets X2 = Retained Earnings / Total Assets X3 = EBIT / Total Assets X4 = Market Value of Equity / Total Liabilities X5 = Net Sales / Total Assets Original Altman Z Score for Public Companies the original model to calculate the Z score for public manufacturing companies is as follows. Z = 1.2*X *X *X *X *X5 Where Z is 3.0 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors could cause unexpected reversals. Eicher Motors Hindustan Motors Ashok Leyland Atul auto Maruti Suzuki Hero Motor Corporation Bajaj Auto Force Motors is in the grey area and caution should be taken. Where Z is 1.8 to 2.7, the company is likely to be bankrupt within 2 years. This is the lower portion of the grey area and a dramatic turnaround of the company is needed. Where Z is below 1.8, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive. LIMITATION OF STUDY This method cannot be applied on financial companies like Thomson Reuters, Golden Sachs, and Fidelity Investments. As we experience of economic stress, Overall Altman Z score is a function of liquidity, balance sheet strength and earning power of companies. The formula of Altman Z score is not suitable for many industries, especially finance sector companies. Let us go by example what does sales mean for a bank? Financials tend to be highly levered and their operating risks and exposures are not well disclosed 41

6 total asset working capital retained earning EBIT book value of market value Sales BIMS International Journal of Social Science Research ISSN ANALYSIS AND S EICHER MOTORS Particulars Year 1(2016) Year 2(2014) total asset 3, , working capital retained earning 2, , EBIT 1, book value of total debt market value Sales 6, , , , , , , , , Calculation of Altman Z score Formula, Year 1(2016) Year 2(2014) Year 3(2013) Z= 1.2x1+1.4x2+3.3x3+0.6x x5 X1 =Working Capital/Total Assets X2 =Retained Earnings/Total Assets X3 =EBIT/Total Assets X4 =Market Value of Equity/Book Value of Total Debt X5 =Sales/Total assets Where as parameter x x x x x Z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe As Z score for Eicher motors is more than 2.99 it is in the safe zone. This is mainly because of Niche product of Eicher motors that are Royal Enfield, the sales of Royal Enfield has outperformed Hero Motor Corp. It is advisable to invest in companies like this. The fundamentals are very strong, total asset of companies is increasing quarter to quarter. New showrooms in overseas and in domestics is numbering high. Apart from motorcycles they do manufacture genuine spares, helmets, accessories etc. are in high demand. 42

7 TATA MOTORS Particulars year 1 year (2015) 2(2014) total asset 49, , working capital retained earning 14, EBIT book value of total debt market value 1,43, ,43, sales 38, , ,60, ,40, ,20, ,00, , , , , , year 1 (2016) year 2(2014) Calculation of Altman Z score x x x x x z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe Z score for Tata Motors India Private limited is more than 2.99 and hence is in safe zone and far away from bankruptcy. We can say Tata motors is better company to invest for long term in the point of financial health of the company. Altman Z score is one of the parameter or it is one type of the analysis were an investor should undergo. There are many other parameters or tools where an investor should undergo before investing. New products like Tata Teago, Xenon will be game changer Tata motors get more of its raw materials are from its subsidiary companies like Tata steel etc. The fundamentals looks good but company should focus on innovation and cost cutting method. HINDUSTAN MOTORS Particulars total asset working capital retained earning EBIT book value of total debt market value Sales

8 total asset working capital retained earning ebit book vaue of market value= sales BIMS International Journal of Social Science Research ISSN year1 (2015) year 2 (2014) Especially in today s business, it is more volatile than we think and it is. It is the worst performer among the stocks which I have picked up. The Z score is more than 2.99 but it may come lesser than it. Hindustan motors should fallow the world Change, because change is a way of life. ASHOK LEYLAND Calculation of Altman Z score parameter year1 (2015) year 2 (2014) x x x x x Z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe Particulars total asset 13, , working capital retained earning 1, , EBIT book value of total debt market value 30, , Sales 13, , ,40, ,20, ,00, , , , , , year1 (2015) year 2 (2014) Hindustan Motors is very good example for saturation stage business. Yes its products are obsolete in nature, it cannot stand with its competitors, and the changes in technology should be increased drastically. 44

9 total asset working capital retained earning ebit book vaue of market value= sales BIMS International Journal of Social Science Research ISSN Calculation of Altman Z score parameter x x x x x Z score ATUL AUTO Particulars total asset working capital retained earning EBIT book value of total debt 0 0 market value 1, , sales Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe year1 (2015) year 2 (2014) Karnataka State Road Transportation Corporation (KSRTC) and Bangalore Metropolitan Transport Corporation (BMTC) were the value based customers of Ashok Leyland. Due to lack of innovation these above companies changed their preference to VOLVO and Tata motors. Still Ashok Leyland has all the resources to acquire the market. Calculation of Altman Z score parameter x x x x4 0 0 x Z score

10 Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe They are one of the pioneers in manufacturing three wheelers both used for domestic purposes and commercial purpose. Z score is pretty low when compare to other companies. Even though Z score is more than 2.99 but that doesn t assure the performance of the company. It is advisable to book the profits selling its share off. 1,40, ,20, ,00, , , , , , year1 (2015) year 2 (2014) MARUTI SUZUKI Particulars Calculation of Altman Z score total asset 33, , working capital retained earning 23, , EBIT 5, , book value of total debt market value 1,23, ,23, Sales 50, , parameter x x x x x Z score Critical values of Altman s Model. Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe 46

11 total asset working capital retained earning EBIT book vaue of total debt market value sales BIMS International Journal of Social Science Research ISSN The only Indian car maker which is having a great trust with its customer and has fantastic sales after service is Maruti Suzuki. Its Z score has improved pretty well, Maruti Suzuki is flourishing with new concepts, models like Vitarra Brezza Baleno SX4 and all new Swift (next gen) 80, , , , , , , , year1 (2015) year 2 (2014) Is ruling the market, of course its tuff competitor that is Hyundai is dominating now and Maruti Suzuki has taken all the steps to overcome it. Premium showrooms NEXA and New generation Swift will Fire the market. It s in safe zone and good growth opportunity I highly recommend to invest in Maruti Suzuki stocks, given the right time. BAJAJ AUTO Particulars total asset 15, , working capital retained earning 10, , EBIT 4, , book value of total debt market value 75, , Sales 22, , Calculation of Altman Z score Parameter x x x x x Z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe The Z score is certainly more than 2.99 but the business model of Bajaj is not attractive. Because there is lack innovation and product portfolio is approachable, Bajaj is still selling its trump card motorcycle Bajaj 47

12 Pulsar. The acquisition of Ninja from Kawasaki is the only hope for investors. Rural market is in the hands of Hero Motor Corporation, when it comes to city rides and touring Royal Enfield is the king. The situation of Bajaj is pathetic. Bajaj should work on new models. Though it launched new motorcycle Vikrant but the looks of the motorcycle is not approachable. It is better to hold Bajaj Auto stocks. FORCE MOTORS Particulars total asset 1, , working capital retained earning 1, , EBIT book value of total debt market value 3, , Sales 2, , , , , , , , , year1 (2015) year 2 (2014) Calculation of Altman Z score Parameter x x x x x Z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe Force motors is best known for its cost cutting technology, its revolutionary products are Tempo Traveler and Force Thoofan, and this is having fair good sales. The Z score is more than 2.99 and hence the company is in safe side. Apart from the cash cow products there is a scope for the organization to build upon and untapped rural market in one option, there are lots option to build upon. From my side, from Altman Z score point of view it is advisable to invest in Force motors. 48

13 HERO MOTOR CORP Particulars year1 year 2 (2015) (2014) total asset 10, , working capital retained earning 6, , EBIT 3, , book value of total debt market value 61, , Sales 28, , Calculation of Altman Z score Parameter x x x x x Z score Critical values of Altman s Model Score Zone Result Z<1.8 Distress Likely to bankrupt 1.8<Z<2.99 Grey Zone Stale Z>2.99 Safe Zone Safe 70, , , , , , , year1 (2015) year 2 (2014) Hero Motor Corporation is well known for its reliability and assurance. It has successfully tapped Indian rural market. We can find the showroom of Hero Motor Corp in villages. This says it has strong business root. There are some areas where it should concentrate on are targeting urban market with premium motorcycles. Innovation is the only key to success. New set of premium bikes has to be launched by Hero. It is said that Hero Motor Corp lost its value when Honda left the collaboration with it. Earlier it was Hero Honda but now is Hero Motor Corp. Z score for Hero Motor Corp is more than 2.99 and hence it is advisable to invest in this company on financial health of company. Of course an investor should undergo other analysis methods 49

14 Eicher Motors Hindustan motors Atul Auto Bajaj Auto hero motor corp BIMS International Journal of Social Science Research ISSN Tables showing consolidated data: To be more precise let us put all the data under one head so that it would be very clear to understand. The above graph shows the overall parameter which is used to calculate Altman Z score Table Showing Two Wheeler Company data only Two Wheelers hero motor Corp Bajaj Auto Eicher Motors Total asset 10, , , Working capital Retained earning 6, , , EBIT 3, , , Book value of total debt Market value 61, , Sales 28, , , ,60, ,40, ,20, ,00, , , , , , Total asset Working capital Retained earning EBIT Book vaue of total debt Market value Data showing other than two wheeler 50

15 hero motor Bajaj Auto Atul Auto Hindustan Eicher Motors Total asset Retained earning Book vaue of Sales BIMS International Journal of Social Science Research ISSN ,60, ,40, ,20, ,00, , , , , , Tata Motors Hindustan motors Ashok Leyland Atul Auto It is evident that Z score is highest in Eicher motors and lowest in Atul auto Data showing net profits of all the companies Maruti Suzuki The above graph shows overall parameters which we consider while calculating Altman Z score. Table showing Z score values: Company Z Score hero motor corporation Force Motors Bajaj Auto Maruti Suzuki Atul Auto Ashok Leyland Hindustan motors Tata Motors Eicher Motors GRAPHICAL REPRESENTATION Z Score Z Score FINDINGS It is evident that Investing in stock market is risky but right information at right time in right place will fletch you the returns. Investing in Equities is risky but it can be optimized by acquiring the knowledge There are various tools or analysis which can be done before investing. It may be fundamental or technical analysis. If Altman Z score analysis is done in internally, it will be easier for those companies to overcome the hurdles. This is an advantage for companies. Investors may be Institutional investor, individual or professionals must use Altman Z score analysis. Because most of the people will not use it and me personally use it. Most of the company s financial health is good as we have concentrated only on Automobile sector. Automobile companies generally play well because India is a huge market. 51

16 SUMMARY OF FINDINGS It is evident that investing in stock market is risky but it s sure that there is a return associated with it. But 4% of Indian population are active investors in stock market. Does it mean investing in equities is too risky; Risk can be hedge by value investing. It is said that we should no keep the entire in one basket. It is better to diversify the portfolio and knowledge makes it happen. More we learn more we can earn and learning never ends because. The world Finance is an ocean and it is difficult to master in it but knowing the basics can have edge over it. There are two types of analysis were in an investor can do and they are as fallows, Technical Analysis Fundamental Analysis Technical Analysis is more of numbers and deals with various formulas and charts. Technical Analysis does not consider news and other macroeconomic factors but it completely based on numbers, charts and formulas etc. Fundamental analysis involves analysing the characteristics of a company in order to estimate its value. Fundamental analysis is the inspection of the underlying forces that affect the well-being of the economy, industry clusters, and corporations. As with most analysis, the goal is to originate a prediction and profit from future price activities. To be more precise it is the basic method where in each and every individual can do just by taking the look at market value of the stock and company background. CONCLUSION The application of financial instability can be measured by using Altman Z score. It is evident that research done by others is 80% true because it was cross verified with the outcomes and the probability of perfect outcome is 80%. The above research can be done by individual, Institution or professionals etc. Altman Z score is an analysis which can be done easily by referring some of the financial statements of companies. Altman Z score holds good only for listed companies. Listed companies in the sense companies those are listed in stock exchanges. The Indian Automobile industry is doing pretty well, because of Indian economy and of course population. India is world s number 1 country in number of two wheelers running. Indian companies are a concentrating on alternate fuel such as LPG, Hybrid vehicles, solar powered vehicles etc. which is again new market for the companies. At the end I would like to conclude that Altman Z score analysis is one of the best tool or method to find listed companies financial health especially the probability of bankruptcy in future and credit worthiness by using financial statement and it still remains promising but challenging. As India seeks to become one of the world s largest automobile markets, just imagine how our companies would perform it is interesting to look at its evolution over the 52

17 years. India s attraction as a destination for automobile manufacturers has been underscored by the number of new manufacturers entering the country over the last two decades. Unlike in several markets, the number of manufacturers has continued to grow in India over the years across vehicle segments. Global consolidation is a natural process of business alignments based on technologies and market opportunities, says Daimler s Marc Llistosella. The Indian market is evolving as the next big opportunity and players from across the world see it as a natural extension of their business domain. And Indian players in the automotive component sector are now viewing the entire global market as an opportunity. With high skill levels and a competitive environment, they are no longer limited to viewing India alone. Indian Automobile market is emerging and it is not restricted to Indian boundaries anymore and it is going a long way and it is global now. SUGGESTIONS Suggestion to Company Companies which is having Z score which is less than 1.8 is it is said to be bankrupt, As per analysis, Atul Auto and Hindustan Motors have week Z score, they are safe as per my analysis but when compared to its peers it is worst performer, In simple those two companies should work on fundamentally. As per analysis, Eicher Motors have very good score highest when compared to its peers. The Eicher motors should tap rural market and open new stores in overseas. So, it is very clear Atul Auto and Hindustan Motors are worst performer and Eicher motors is best performer. Suggestion to individuals Individuals, who want to invest their money in stock market, may be Institutional investors or professional, investing in these companies which are having very poor credit worthiness and which tends to bankrupt in future does not make any sense. Apart from Altman Z score Analysis there are many other tools which they should consider before investing. Apart from investment point of view individuals can understand the company s financial health. It is one of the parameter to understand the performance of company in long term LIMITATIONS Altman Z score cannot be applied for Financial Institutions like Banking firm or Institutions Investing firms etc. The probability of correctness is 80% when conducted originally by Altman. For analysis we have taken only Automobile sector because time us constrain for us. Articles: REFERENCES 1. Aloy Niresh.J. and Pratheepan. T - International Journal of Business and Management; Vol. 10, No. 12; 2015 ISSN E-ISSN The Application of Altman s Z-Score Model in Predicting Bankruptcy: 53

18 Evidence from the Trading Sector in Sri Lanka Published by Canadian Center of Science and Education 2. PREDICTING FINANCIAL DISTRESS OF COMPANIES: REVISITING THE Z SCORE AND ZETA MODELS - Edward I. Altman* - June 2000 *Max L. Heine Professor of Finance, Stern School of Business, New York University. Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankruptcy, Journal of Finance, September 1968; and E. Altman, R. Haldeman and P. Narayanan, Zeta Analysis: A New Model to Identify Bankruptcy Risk of Corporations, Journal of Banking & Finance, 1, 1977 Author s Profile: M.S.Prathibha Raj Research Scholar Bharathiar University Assistant Professor MBA Department Acharya B School prathibharaj@acharyabbs.ac.in Dr. Dinakar G Program Director-MBA Bangalore Institute of Management Studies Bangalore. dinakargrao@ediffmail.com 3. Rohini Sajjan - PREDICTING BANKRUPTCY OF SELECTED FIRMS BY APPLYING ALTMAN S Z- SCORE MODEL. International Journal of Granthaalay- ISSN (O) ISSN (P) - April Sanobar anjum - Business bankruptcy prediction models: A significant study of the Altman s Z-score model - ASIAN JOURNAL OF MANAGEMENT RESEARCH - ISSN Research Article Volume 3 Issue 1, Roli Pradhan - Z Score Estimate for Indian Banking Sector- International Journal of Trade, Economics and Finance - Vol. 5, No. 6 - December