Article Details
  • Published Online:
    January  2025
  • Product Name:
    The IUP Journal of Accounting Research & Audit Practices
  • Product Type:
    Article
  • Product Code:
    IJARAP080125
  • DOI:
    10.71329/IUPJARAP/2025.24.1.135-149
  • Author Name:
    Aravam Dhanunjayulu and K Jayachandra Reddy
  • Availability:
    YES
  • Subject/Domain:
    Finance
  • Download Format:
    PDF
  • Pages:
    135-149
Volume 24, Issue 1, January 2025
Financial Distress of Selected Cement Companies in India: An Analysis Using Altman Z-Scores
Abstract

Finance is the vital input for any kind of business unit. Financial soundness has a great impact on the success and survival of a business enterprise, and cement companies are no exception to this. The cement companies in India have been playing an important role in nation-building. In this context, studies on the financial soundness and viability of cement companies in India gain greater importance. The present paper analyzes the financial distress of selected cement companies in India with the help of Altman model Z-score for the period 2012-13 to 2021-22. The study concludes, based on the Z-score results, that out of the six selected cement companies, UltraTech and Ambuja Cement are in safe zone, Dalmia and JK Cement are in gray zone, and Birla and India Cement are in distress zone, with regard to their financial soundness.

Introduction

The cement industry in India is a vital component of the nation’s infrastructure and economic development. As the second-largest producer of cement in the world after China, India plays a crucial role in meeting both domestic and global construction demands.