ICRA

The ICRA Ltd. has been promoted by Industrial Finance Corporation of India (IFCI) as its main promoter with its head quarters at New Delhi. It is an. independent company limited by shares with an authorised share capital of Rs 10 crores against which Rs. 5 crore is paid up. IFCI holds 26% of the share capital and 74% is contributed by UTI, LIC, GIC, PNB, CBI. Bank of Baroda. UCO Bank, EXIM Bank, HDFC Ltd. and ILFS Ltd. It started operations in 1991. Objectives The main objectives of ICRA are ;

To provide information and guidance to institutional and individual investors and creditors; To enhance the ability of the borrower/issuers to access the money market and the capital market for tapping a larger volume of resource from a wider range of investing public; To assist the regulators in promoting the transparency in the financial markets; To enable the banks, investment bankers, brokers in placing debt with investors by providing them with a marketing tool.

Range of Services offered ICRA has diversified the range of its services. It currently provides there types of services namely : 1. Rating Services 2. Information Services 3. Advisory Services ICRAs Rating Services. ICRA is the most established credit rating agency in India today. ICRA rates rupee-dominated debt instruments issued by manufacturing companies, commercial banks, non-banking finance companies, financial institutions, public sector undertakings and municipalities among others. The obligations include long term instruments such as bonds and debentures, medium term instruments such as fixed deposit programmes, and short-term instruments such as commercial papers and certificates of deposit. ICRA also rates structured obligations and specific sector debt obligations such as instruments issued by power, telecom and infrastructure companies. The other services in the area of credit rating include the following : Credit Assessment. ICRA makes an assessment of the relative degree of capability of the company undertaking to repay the interest and principal as per the terms of the contract. This assessment is made in respect of companies/undertakings intending to use the same for obtaining

specific lines of assistance from commercial banks, financial/ investment institutions, factoring companies and financial services companies. General Assessment. ICRA prepares general assessment reports at the request of banks or any other potential users. Non-banking/ non-financial agencies also approach ICRA for general assessment of companies going for merger, amalgamation, acquisition, joint venture, collaborations and factoring of debts. No specific symbols are used for general assessment. Bank Lines of Credit Rating. ICRA helps the banks and financial institutions in their lending decisions by forming an opinion as to the risk involved in lending. This service is also useful for financial services companies who are taking large risks with corporate clients. Various financial and non-financial parameters like management, technology, market and marketing network, product range and industry are looked into before assigning final rating. Credit Assessment for Small-Scale and Medium Scale Industries. ICRA forms broad opinion as to the relative degree of capability of small medium sized unit to repay the principal and interest as per the terms of the contract. The assessment can be used to obtain finance from bank/financial institutions by these industries. The assessments are based on an indepth study of the industry as also an evaluation of the strengths and weaknesses of the unit. While making an assessment the following factors are looked into : 1. Marketing strategies 2. Cash flow trends 3. Operational efficiency 4. Competence and effectiveness of management 5. Hedging of risks 6. Liquidity 7. Financial flexibility 8. Asset quality 9. Past record of servicing debts & obligations 10. Government policies

Insurance Company Claims Paying Rating. ICRA has developed a methodology to rate the claims paying ability of insurance companies to meet its policy holders obligations. It follows an independent and professional approach so as to give reliable, consistent and unbiased opinions. The following are the benefits of Claims Paying Rating (CPR) : (0 It would provide a timely, authentic and correct information about the relative capacity of the insurance company to service the claims

and obligations to the purchaser of insurance company policies. (ii) It would help the insurance company to expand their market base of policyholders. Information Services. The information services group focuses on providing authentic date and value added products used by intermediaries, financial institutions, banks, asset managers, institutional and individual investors and others. Value added services include :

Equity Grading providing a critical input on a companys earning prospects of equity investors, Equity Assessment aiming at preparation of assessment report specific to the investors need whenever request is made by him. Corporate Review providing a clear picture of the key issues facing a corporate entity. Money and Finance a quarterly publication relating to monetary an; fiscal sector of the Indian economy. Investment Information Publications are brought out by the Information Services Division of ICRA since 1993 providing in-depth analysis of different sectors and industries. Corporate Reports providing exhaustive and reliable information : investors which may affect their investment decision. Report cover? almost all areas such as industry background, financial performance operational analysis, prospects etc. and are updated regularly in light of changes in business and economic conditions. Advisory Services.

ICRA offers wide range of management adviser services which includes :

Strategic counselling Risk management Restructuring solutions Inputs for policy formulation Client specific need based studies in the banking and financial serviced; manufacturing and services sector etc.