PRESENTED BY-

NAME- AVINAW KUMAR

ENROLMENT NO-20BSPDD01C033

SUMMITTED TO-DR. DEEPTI KIRAN

I C FA I U N I V E R S I T Y D E H R A D U N
 PRESENTATION ON
CREDIT RATING
s a quantified assessment of the creditworthiness of a borrower in general terms or with respect to a
r financial obligation. A credit rating can be assigned to any entity that seeks to borrow money—an
oration, state or provincial authority, or sovereign government.
an analysis of the credit risks associated with a financial instrument or a financial entity. It is a
particular entity based on the credentials and the extent to which the financial statements of the
, in terms of borrowing and lending that has been done in the past.
on detailed analysis are published by various credit rating agencies like Standard & Poor's, Moody's Investors Service,
 OBJECTIVES OF CREDIT RATING

nce to investors or creditor in determining a credit risk associated with debt instrument or credit obligation.

between risk and return.

making investment decision.

ng tools

ators in promoting the transparency in the financial market.

 FEATURE OF CREDIT RATING

ecificity to debt instrument

dance to investors.

a Recommendation to buy , hold or sell.

ad parameter of information.

ntitative and Qualitative.

 INSTRUMENT FOR RATING

es issued by a company.

hares issued by a company.

ntures issued by corporate government etc.

papers.

gulator of Indian capital market , has decided to enforce mandatory rating of all debt instruments.
 IMPORTANCE OF CREDIT RATING
biased opinion to investors. Opinion of good credit rating agency is unbiased because it has no vested interest in the

y and dependable information. Credit rating agencies employ highly qualified, trained and experienced staff to assess
ave access to vital and important information and therefore can provide accurate information about creditworthiness of
ompany..

mation in easy to understand language. Credit rating agencies gather information, analyse and interpret it and present
easy to understand language that is in symbols like AAA, BB, C and not in technical language or in the form of

s in taking investment decisions. Credit ratings help investors in assessing risks and taking investment decision
 BENEFITS OF CREDIT RATING
nvestors.

he rated company.

ntermediaries.

he business world.
 TYPES OF CREDIT RATING
ds and debentures.

tries

ty shares

urance companies

erence shares.

t-term instruments

estate builders and developers

owers.
 CREDIT RATING AGENCIES IN INDIA
g and Information Services of India Limited (CRISIL)

nformation and Credit rating agency (ICRA)

sis & Research Ltd. (CARE)

 RATING SYMBOLS
 AAA&AA- Highest safety

A- Adequate safety

BBB- Moderate safety

BB-Inadequate safety

B-High Risk

C-Substantial Risk

D- Default.