A Study on Firms Solvency Using Financial Ratios at the Karaikal Cooperative Milk Producers Union Limited, Karaikal

This study evaluates the solvency of the Karaikal Co-operative Milk Producers Union Limited using financial ratios and predictive models over the period 2020–2024. Tools such as the Altman Z-Score, Springate Model, and key solvency ratios were applied to assess the firm’s long-term financial health. The analysis revealed moderate fluctuations in solvency, with both models confirming the absence of critical financial distress. The findings highlight the effectiveness of combining ratio analysis with predictive tools for monitoring financial stability in cooperative societies. The study offers practical insights for improving financial planning and risk management in the dairy sector. Additionally, the results showed that the firm’s equity position strengthened over time while its reliance on debt declined. The Springate scores remained above the distress threshold, and the Altman Z-Scores signaled a positive financial trend, particularly in the final year. These insights underscore the value of proactive solvency analysis in cooperative environments, helping management identify financial risks early and ensure long-term sustainability.