GSS Infotech Limited — financial distress indicators
Financial-health summary
GSS Infotech Limited's reported numbers place it in the 'Very weak' financial-health band (distress score 72/100). The main indicators are cash runway under 12 months, market-implied default probability >20% and operations consume cash. Independently, the Ohlson accounting model puts its 1-year failure probability at 82% and the market-implied (Merton) default probability is 91.5%. In its favour: strong current ratio (2.93).
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
At the current free-cash-flow burn, cash covers ~1 months.
Going-concern standard: management must assess ability to continue for 12 months (Ind AS 1 ¶25–26). Runway below that horizon forces dilution, asset sales or default.
Merton distance-to-default -1.37 σ → PD 92%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Operating cash flow negative in 2 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
O-score 1.54 → model probability 82%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Revenue changed -30% year over year.
Falling sales reduce cash available for debt service.
Price is -62% from its 52-week high.
For financial firms a share-price run often precedes a deposit or funding run (confidence channel).
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Strong current ratio (2.93).
- High insider/promoter ownership (39%) aligns management with survival.
📰 Recent news scan
- GSS Infotech sets Sep 18 record date for AGM e-voting - scanx.tradeGoogle News · 2026-10-07
- GSS Infotech Limited (GSS.NS) Trades Near ₹10.33 After Mild Pullback; ₹9.81 Support in Focus - Vol Target Rebalance - https://www.siam.in/Google News · 2026-10-01
- Genetic Signatures (ASX: GSS) Advances 15.63%: Can the FY26 Reset Rebuild Investor Confidence? - KalkineGoogle News · 2026-08-31
- GSS Infotech Share Price Forecast: 3 Year Outlook to 2030 - UnivestGoogle News · 2026-07-17
⚖️ Indian legal pathway — the IBC, 2016
How insolvency starts
- A financial creditor (§7), an operational creditor after a demand notice (§§8–9) or the company itself (§10) can apply to the NCLT once a default of at least ₹1 crore occurs (§4).
- On admission a moratorium (§14) stops suits and recovery; the board is suspended and an insolvency professional runs the company.
- The Committee of Creditors approves a resolution plan with 66% of voting share (§30(4)) within an outer limit of 330 days (§12); otherwise liquidation (§33) under the §53 waterfall — equity ranks last. Defaulting promoters are generally barred from bidding (§29A).
Earlier warning stages
- RBI's Prudential Framework for Resolution of Stressed Assets (7 June 2019): lenders must review a borrower within 30 days of default and implement a resolution plan, or provide more.
- Listed companies must disclose loan defaults to exchanges under SEBI (LODR); a rating downgrade to “D” is a public signal.
- Auditors must report going-concern uncertainty (SA 570 / Ind AS 1).
Frequently asked questions
What do GSS Infotech Limited's financial-health indicators show?
As of 2026-10-09, GSS Infotech Limited's public financial data places it in the 'Very weak' band with a distress score of 72/100, driven by cash runway under 12 months, market-implied default probability >20% and operations consume cash. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is GSS Infotech Limited's financial distress score?
72/100 ('Very weak'). Ohlson O-score 1.54 (model 1-year failure probability 82%). Merton distance-to-default -1.37 σ (model default probability 91.5%).
What works in GSS Infotech Limited's favour?
Strong current ratio (2.93). High insider/promoter ownership (39%) aligns management with survival.
How are shareholders treated if a company enters insolvency?
Under the IBC the Committee of Creditors controls the resolution; the §53 waterfall pays secured creditors and workers first and equity last. In most resolution plans existing shareholders are wiped out or left with a token stake, and the company may be delisted.
Other IT & Software companies with distress indicators
- Quintegra Solutions Limited (QUINTEGRA)Very weak 95/100
- SecureKloud Technologies Limited (SECURKLOUD)Very weak 83/100
- Suvidhaa Infoserve Limited (SUVIDHAA)Very weak 72/100
- Handson Global Management (HGM) Limited (HGM)Weak 58/100
- RPSG Ventures Limited (RPSGVENT)Weak 58/100
- Xelpmoc Design and Tech Limited (XELPMOC)Weak 57/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.