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Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, Nikhil Adhesives's Probability of Financial Distress (%) is 0.04%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Nikhil Adhesives (BOM:526159) Probability of Financial Distress (%) Explanation
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk in the upcoming year. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Nikhil Adhesives Probability of Financial Distress (%) Related Terms
BOM:526159 vs LIN, SHW, ECL: Probability of Financial Distress (%) Comparison
For the Specialty Chemicals subindustry, Nikhil Adhesives's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Nikhil Adhesives Probability of Financial Distress (%) vs Chemicals Industry
For the Chemicals industry and Basic Materials sector, Nikhil Adhesives's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Nikhil Adhesives's Probability of Financial Distress (%) falls into.
Nikhil Adhesives Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
LPFD
=
-20.12 * NIMTAAVG
+
1.60 * TLMTA
-
7.88 * EXRETAVG
+
1.55 * SIGMA
-
0.005 * RSIZE
-
2.27 * CASHMTA
+
0.070 * MB
-
0.09 * PRICE
-
8.87
=
-7.74
The Probability of Financial Distress (%) (PFD) was then obtianed by:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
What does a Probability of Financial Distress (%) of 0.04% mean?
Nikhil Adhesives (BOM:526159) has a Probability of Financial Distress (%) of 0.04% as of Jul. 17, 2026.
Is Nikhil Adhesives' Probability of Financial Distress (%) too high?
Nikhil Adhesives' current Probability of Financial Distress (%) is 0.04%. Overall, Nikhil Adhesives has a GF Score™ of 66/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Nikhil Adhesives' Probability of Financial Distress (%) compare to LIN and SHW?
Nikhil Adhesives' Probability of Financial Distress (%) of 0.04% can be compared against companies in the Chemicals industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Probability of Financial Distress (%) for a Chemicals company?
A good Probability of Financial Distress (%) depends on the Chemicals industry context. However, Probability of Financial Distress (%) should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Probability of Financial Distress (%) mean?
A high Probability of Financial Distress (%) can signal that a stock is expensive relative to its fundamentals. Nikhil Adhesives's current Probability of Financial Distress (%) is 0.04%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Nikhil Adhesives stock overvalued right now?
Based on GuruFocus' analysis, Nikhil Adhesives (BOM:526159) is currently considered Modestly Undervalued. The stock's GF Value™ is ₹100.35, compared to a current price of ₹75.58 — trading 24.7% below its estimated fair value. The current Probability of Financial Distress (%) is 0.04%. Nikhil Adhesives' overall GF Score™ is 66/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Probability of Financial Distress (%) calculated?
Probability of Financial Distress (%) is calculated from a company's financial statements. For Nikhil Adhesives (BOM:526159), the current Probability of Financial Distress (%) is 0.04% as of Jul. 17, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Nikhil Adhesives (BOM:526159) Overvalued in 2026?
Based on GuruFocus' analysis, Nikhil Adhesives stock appears to be undervalued.
The current stock price of ₹75.58 is trading 24.7% below its estimated GF Value™ of ₹100.35.
GuruFocus considers Nikhil Adhesives to be Modestly Undervalued.
Key valuation signals for BOM:526159:
Probability of Financial Distress (%): 0.04%
GF Value™: ₹100.35 vs. price of ₹75.58 (24.7% below fair value)
No single metric tells the full story. See the BOM:526159 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Nikhil Adhesives Ltd is an India-based company engaged in the manufacturing and trading of polymer emulsions and adhesives. The products of the company include paint emulsions, textile emulsions, construction chemicals, and adhesives. The brands of the company are Mahacol, Emdicryl, Mahafix, Emdilith, Emditex, and Emdibind. The company operates in two business segments namely, Manufacturing of Adhesives and emulsions, which is the key revenue generator; and Trading in chemicals segment.
66GF Score
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