Bankruptcy Prediction of Listed Cement Company in Indonesian Stock Exchanges Using Altman Z-Score Model

Start your abstract here Ratio analysis is one of the most competent tools to predict the bankruptcy of a company. In this paper the bankruptcy prediction of listed cement company in Indonesian Stock Exchanges has been evaluated using Altman Z-score. This study aims to determine the level of the bankruptcy of the listed cement companies in the Indonesian Stock Exchange during 2013 to 2017. There are four listed cement companies, namely PT Semen Indonesia Tbk. (SMGR), PT Semen Baturaja Tbk. (SMBR), PT Indocement Tunggal Prakarsa Tbk. (INTP) and PT Holcim Indonesia Tbk. (SMCB). Based on the results of the research, it shows that PT Semen Indonesia Tbk. (SMGR), PT Semen Baturaja Tbk. (SMBR) and PT Indocement Tunggal Prakarsa Tbk. (INTP) are in the safe zone with the highest Z value which is 15,822 and the lowest Z value which is 3,542. PT Holcim Indonesia Tbk. (SMCB) is in the bankrupt zone because it has a Z value below 1.8. For that reason, all companies need to improve the performance immediately to avoid the bankruptcy happening. There are many ways to avoid the bankruptcy such as improving the sales revenue with stronger sales team, improving operational cost by improving productivity and waste reduction in operation. Lastly the most important thing is the leadership team have to come out with clear objectives and strategic action of how to get out from the bankruptcy zone.