Achieving Financial Sustainability Through Financial Reorganisation: Evidence from the Ellora Paper Mills Ltd

All the sectors of the economy strive to get the limited finances that are available in the economy. The financial environment of the economy should ensure that restricted funds are available for firms that can make the best possible use of them. In that scenario, all firms on the verge of bankruptcy or facing financial distress need to release their funds for use by efficient firms in the economy. The present study intends to assess the impact of financial reorganisation on the operating efficiency of Ellora Paper Mills Ltd. This private limited company manufactures a variety of colour paper in India. The empirical study is based on secondary data extracted through the company’s Financial Statements using the CMIE-Prowess database for The Ellora Paper Mills Limited from 2007–2008 to 2022–2023. Altman’s z-score model was used to consider the level of sickness, and the regression model was applied to the various ratios, assessing profitability, liquidity, solvency, and efficiency for hypothesis testing with the help of SPSS. The results indicate that the company’s operating efficiency improved significantly post-financial reorganisation. The study provides insight into how finance/funds need to be allocated/reallocated to firms to achieve the goal of economic sustainability through financial restructuring.