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Assessing Financial Health Of A Firm Using Altman’S Original And Revised Z-Score Models: A Case Of Kingfisher Airlines Ltd (India)

Author

Listed:
  • Manoj Kumar
  • Madhu Anand

    (Indus Business Academy, Greater Noida, India
    Agra University, India)

Abstract

In this case study, we used both Altman's Z-score and Modified Z”-score models to investigate whether it is possible to rely on Altman’s Models (1968, 1983) to assess financial health and predict financial failure of a publicly traded non-manufacturing company in India. The findings of this case study indicated that the Altman's original Z-score model predicted that the financial health of the firm under consideration is not consistent over a period of 2005 - 2012. The same is confirmed by the Revised Z”-score model as well. According to this study, the models were able to predict financial distress and probable future bankruptcy of the firm. The mean Z-score for the firm under investigation during the period 2005-2012 is 0.918 and the mean Z”-score for the same period is 0.019, both being less than cut-offs confirm poor financial health of the firm and that the bankruptcy is very likely to happen.

Suggested Citation

  • Manoj Kumar & Madhu Anand, 2013. "Assessing Financial Health Of A Firm Using Altman’S Original And Revised Z-Score Models: A Case Of Kingfisher Airlines Ltd (India)," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 2(1), pages 36-48.
    • Handle: RePEc:ods:journl:v:2:y:2013:i:1:p:36-48
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    Cited by:

    1. Ajaan Rahman Khan & Chinmoy Das Gupta & Md. Ali Ashraf, 2021. "Relationship Between Banking Performance and Financial Distress: A Study on Banks of Bangladesh," Issues in Economics and Business, Macrothink Institute, vol. 7(1), pages 15-25, June.
    2. M. M. Swalih & M. S. Vinod, 2017. "Application Of Altman Z Score on BSE-Greenex Companies," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 6(3), pages 205-215, September.
    3. Anatoliy G. Goncharuk, 2018. "Efficiency vs Effectiveness: Alternative Metrics for Research Performance," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 7(1), pages 24-37, February.
    4. G. V. Satya Sekhar, 2018. "Measuring Models and Trends in International Factoring: 2009-2018," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 7(4), pages 236-245, November.

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