ICRA stands for Investment Information and Credit Rating Agency in full. For its unique and beneficial functions, the ICRA is extremely popular. The Investment Information and Credit Rating Agency is a reliable source of financial information for investors.
In 1991, the ICRA was revised and renamed from the IICRA to the current ICRA.
The ICRA became a publicly traded business in April of 2007. The ICRA converted the company from a private limited company to a public corporation.
The National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) both trade ICRA shares. This is a joint venture business founded by a number of Indian commercial banks as well as a few other financial institutions.
ICRA provides a variety of services to investors, companies, individuals, and creditors. The following are the special features:
- Several investors, entities, people, and creditors are guided by it.
- It assigns a rating to enterprises in the multi-sector to assist them in making investment decisions.
- They provide advanced services to intermediaries in order to improve the efficiency of the fundraising process.
- ICRA promotes market transparency by monitoring and regulating a number of companies.
- To improve the borrower’s ability to access a large number of resources.
ICRA Unique Factors
The Investment Information and Credit Rating Agency is known for several distinct characteristics, including the following:
- This company is made up of various different businesses and their subsidiaries.
- The ICRA is a publicly traded business with a limited number of shares.
- ICRA is listed on BSE and NSE.
- This organization is one of the country’s most well-known credit rating firms.
- This entity rates debt instruments submitted by financial institutions, government undertakings, manufacturing companies, commercial banks, and other entities.
- Moodys Investment Service and this credit rating agency are partners. It is ICRA’s most powerful stockholder.
Companies covered under ICRA Rating:
Companies in the following sectors receive the ICRA rating:
- Financial Sector
- Structured Financial Sector
- Infrastructure Sector
- Debentures and mutual funds
- Public Finance Sectors
- Corporate Debt Rating
Criteria of ICRA rating
As previously stated, ICRA provides credit rating services for a variety of financial instruments and businesses based on a set of criteria. The ICRA assigns credit ratings to the securities listed below.
- Long-term investment securities
The instruments like NCD with a period of 1 year or more comes under the category of long period securities. The ICRA rates the debt instruments in the range of [ICRA]AAA to [ICRA]D,
- [ICRA]AAA The ICRA has given this entity the highest rating.
- [ICRA]AA Excellent score
- [ICRA]A sufficient level of safety
- [BBB [ICRA] Moderate degree
- ICRA]BB Moderate danger
- High-Risk ICRA]B
- Very High Risk (ICRA)
- [ICRA]D represents the greatest risk to investors and is predicted to fail soon.
- Medium-term securities (only for Public Deposits)
The category of Securities of the Medium Period includes public deposit programs. The ICRA assigns the following ratings to these medium-term securities:
- ICRA’s highest rating is MAAA.
- MAA The highest credit-worthiness
- MA The highest credit-worthiness
- Appropriate Credit Quality (MB)
- MC Insufficient credit quality
- MD The ICRA has given it the lowest grade.
- Securities for a limited time
The rating category of short term securities includes instruments with a term of less than one year.
The ICRA assigns a rating to each category based on the following criteria:
- [ICRA]A1 ICRA’s highest rating.
- [Medium [ICRA]A2 rating
- [A4 (ICRA) medium rating
- [ICRA]D is the lowest ICRA rating and carries the greatest risk for investors.