ANALYSIS OF FINANCIAL DISTRESS IN PHARMACEUTICAL COMPANIES LISTED ON IDX

Abstract

Abstract – The emergence of the Covid-19 pandemic in 2020 made the economy weaken. the virus spread very quickly and spread to various countries around the world, lasting until 2021. This condition requires business actors to continue to grow and develop amidst a weakening economy so that they can maintain their business by using corporate strategies to obtain maximum income, this makes competition business is getting tougher. Almost all sectors experience the same impact, namely financial distress, including pharmaceutical companies. This study aims to analyze the prediction of financial distress of pharmaceutical companies in Indonesia using the Altman, Grover, Springate, and Zmijewski models. The data used in this research is secondary data, in the form of the company's financial reports for the 2020-2023 period. The samples used in this study were 8 pharmaceutical companies out of a total of 30 health and pharmaceutical companies listed on the Indonesia Stock Exchange. There is 1 company experiencing financial distress using the Altman method, 1 company using the Grover method, 6 companies using the Springate method and 1 company using the Zmijewski method. When viewed based on the overall results during the observation period, there was 1 company that experienced continuous financial distress during the 2020-2023 period, namely PT Indofarma Tbk (INAF). From the results of the ANOVA test it is known that there are differences in the four methods used and shows that the Grover model has the highest level of accuracy, with 98% accuracy and 2% error type.

 Keywords:  Financial Performance, Financial Ratios, Financial Distress