Top Credit Rating Agencies of IndiaCredit Rating Information Services of India Limited (CRISIL)

Investment Information and Credit Rating Agency of India (ICRA)

Credit Analysis & Research Limited (CARE)

ONICRA Credit Rating Agency of India Ltd.

Fitch India

Small and Medium Enterprise Rating Agency

Brickworks

CRISIL CRISIL was set up in the year 1987 in order to rate the firms and then

entered into the field of assessment service for the banks. Highly skilled members manage the agency. Ms. Roopa Kudva who acts as the Managing Director and Chief Executive Officer of the company heads it. The company has set up large number of committees to look after dispersal of various services offered by the company for example, investor grievance committee, investment committee, rating committee, allotment committee, and compensation committee and so on.

Some important points about CARE• CRISIL Ratings plays a leading role in the development of the debt markets

in India. • CRISIL Ratings provides technical know-how to clients worldwide. • CRISIL Ratings is India's largest rating agency, having rated more than

24,541 debt instruments.• CRISIL Ratings has a 70 per cent penetration in the domestic debt market.

CRISIL is divided in two main categories• CRISIL LTD.• CRISIL INFRASTRUCTURES.There are three sections under CRISIL Ltd viz, Ratings, Research, Advisory.

Rating Methodology Different for different sectors such as• Corporate/Manufacturing• Finance• Infrastructure• Structured Finance• Funds• Governance & Value Creation• Real Estate Developers/Project Rating• Maritime Grading• Microfinance Institutions Grading• SME Criteria for Small and Medium Enterprises

CRISIL Grading MFIs• CRISIL launched MFI (Micro Finance Institutes) grading in 2002.• World’s first credit rating agency to develop a separate methodology and

scale to assess MFIs. • Since then, CRISIL has assessed around 150 MFIs and established itself as

the leading rating agency in the Indian microfinance space. • In addition to MFI grading and risk assessment services, it rates MFIs’ bank

facilities and securitization transactions.• It is India’s first rating agency to have rated bank loans of MFIs and

securitization transactions involving microfinance loan receivables.

ICRAICRA was established in the year 1991 by the collaboration of financial institutions,

investment companies, and banks. The company has formed the ICRA group together with its subsidiaries. The company is headed by Mr. Piyush G. Mankad and offers products like short-term debt schemes, Issue-specific long-term rating and offers fund based as well as non-fund based facilities to its clients.

Some important points about ICRA• ICRA Limited is in Alliance with ‘Moody's Investors Service’ and ICRA’s largest

shareholder. • It is a public limited company with an authorized share capital of Rs.10 crore, Rs. 5

crore is paid up.• ICRA’s major shareholders IFCI (26%), and the balance by UTI, LIC, GIC, PNB, Central

Bank of India, Bank of Baroda, UCO Bank and banks (SBI).• Alliance with Moody’s Investor Services has given them Brand name and it provides

high value Technical services.• It benefits ICRA’s in-house research capabilities and access to Moody’s global

research base.

CARE CARE is a full service rating company that offers a wide range of rating and

grading services across sectors. It was incorporated in 1993 by consortium of Banks/financial institutions in India. The three largest shareholders of CARE are IDBI Bank, Canara Bank and State Bank of India.

Some important points about CARE• Registered with SEBI under the Securities & Exchange Board of India

(Credit Rating Agencies) Regulations, 1999.• CARE’s Ratings are recognized by Govt. of India and all regulatory

authorities like RBI and SEBI.• CARE is a founder member of Association of Credit Rating Agencies in Asia

(ACRAA).

CARE contd.Quality of Ratings• Independent & Renowned External Rating Committee• Impressive Track Record of more than 15 years• Leader in bank ratings• Developing rating methodologies for new segments like Cooperatives,

Service sector, trading etc. Core Competency • CARE believes in independence in rating decisions and has an external

rating committee that decides each rating. • It consists of members who are reputed professionals from various

industries like IDBI Ltd, Reserve Bank of India, Hindustan Lever Ltd, etc.

ONICRA

Onicra was established in 1993, by Mr. Sonu Mirchandani, who at the time, promoted consumer durables major, Onida. Mr. Mirchandani observed a transparency vacuum, in terms of lack of credible information on individuals and corporations. Unlike the West, India did not have a credible system to screen financial profiles.

Operations began with one office that conducted 10 cases per month. The company now operates with a network of over 148 branches, covering more than 500 locations pan-India, and touches over 30,000 unique case everyday.

• Onicra operates as a financial services organisation. Its products and services include Individual Credit Rating, SME rating, Employee Background Screening, Customer Profiling & Rating (CPR), Associate Rating and IT solutions, across the telecom, banking, health, insurance, education and auto sectors.

• The company has been acknowledged as pioneers in this field by the Ministry of Finance in the Economic Survey (1993–1994). It is recognised and empanelled by the likes of NSIC (National Small Industries Corporation Ltd., and the IBA (Indian Banks Association), for performance and financial ratings. The Employee Background Screening division is certified by NASSCOM and NDMA.

Rating Methodology The basic methodology followed to formulate and plan the mathematical model for rating is consistent across individuals and corporates. It follows a five step process.

• The first step is the definition of the objective- which is the entity that needs to be rated.

• This is followed by collation of all the high level parameters that affect the entity. This high level parameter collation is done using a mix of market analysis, in-house expertise, primary and secondary research.

• Once the parameters are identified, Onicra follows a top-down approach of parameter decomposition. This simply entails decomposing the parameters into the sub-parameters upon which they are dependent at several levels, until we reach independent and quantifiable parameters.

• These parameters are input into a mathematical model and analyzed to ensure that the results are in line with actual behavior.

• Simultaneously, the organization’s research groups are constantly monitoring and keeping checks on various other parameters, both environmental and economic to keep the model being worked on, relevant, fresh andup-to-date with the fast changing financial and economic scene.

FITCH India

It is a joint venture between international credit rating agency Duff and Phelps and JM financial and Alliance group and was founded in 1996.

In addition to debt instruments, it also rate companies and countries on request.

SMERA

SME Rating Agency of India Limited (SMERA) is a third party rating agency exclusively set up for micro, small and medium enterprises (MSME) in India for ratings on creditworthiness. It provides ratings which enable MSME units to raise bank loans at competitive rates of interest

The agency was founded in 2005 by Small Industries Development Bank of India (SIDBI), Dun & Bradstreet Information Services India Private Limited (D&B) and several leading banks in the country

BRICKWORKSBrickwork Ratings is a Bangalore-based company incorporated

in 2007 with the mission of providing unbiased information to Indian investors for making better investment decision

Brickwork Ratings, a SEBI licensed credit rating agency, founded by bankers, credit rating professionals, former regulators as well as professors,, is committed to promoting Financial Literacy, having its corporate office in Bangalore and branches at New Delhi, Mumbai, Chennai, Hyderabad and Pune.

Brickwork's proprietary models in credit risk customised for large corporates, SMEs, banks, financial institutions, state and local governments, help investors understand the complexity of the investment world.