Altman Z-Score Flags 8 India Stocks Below 0.37

Eight stocks in India now carry Altman Z-Scores below 0.37. The data is as of Sept. 28, 2026. The threshold for distress is 1.8. The screen flags [LICI](/stock/LICI) (NSE: LICI) and seven banks: [Central Bank of India](/stock/CENTRALBK) (NSE: CENTRALBK), [Canara Bank](/stock/CANBK) (NSE: CANBK), [Bank of Baroda](/stock/BANKBARODA) (NSE: BANKBARODA), [Punjab National Bank](/stock/PNB) (NSE: PNB), [Bank of India](/stock/BANKINDIA) (NSE: BANKINDIA), [UCO Bank](/stock/UCOBANK) (NSE: UCOBANK) and [Union Bank of India](/stock/UNIONBANK) (NSE: UNIONBANK). The Altman Z-Score weights working capital, retained earnings, EBIT, market value of equity and sales against total assets. Scores below 1.8 fall in the distress zone. Below 0.37 is an extreme reading on the standard scale. What the Altman Z-Score distress zone means for banks For banks, the score has a known flaw. Deposits are liabilities, so debt-to-equity ratios run high even at stable lenders. A bank with a 10-to-16 times debt-to-equity ratio can be solvent if capital adequacy is comfortable. A manufacturer with that ratio would be in trouble. The Z-Score doesn't separate the two cases. LICI has a similar issue. Policyholder liabilities dominate its balance sheet. The model reads that float as pressure. It doesn't measure embedded value or persistency. Those matter more for an insurer. That's why this is a screening flag, not a verdict. It sits next to other data points: low P/E multiples and high debt-to-equity ratios. Most of these PSU banks trade between 5 and 9 times trailing earnings. The broader Nifty Bank universe prices closer to 12 to 14 times. The gap reflects slower credit growth. It also reflects thin return on equity at some state-owned lenders and episodic asset-quality stress. How the low Z-scores compare across the sector Central Bank of India and UCO Bank sit at the lower end of the valuation range. Bank of Baroda and Canara Bank bring larger balance sheets and stronger deposit franchises, but...