CREDIT RATINGS

India Ratings & Research (Ind-Ra) Rating Symbols and Definitions

 

The Securities and Exchange Board of India (SEBI) has, vide circular CIR/MIRSD/4/2011 dated June 15, 2011, standardised the rating symbols and their definitions for all credit rating agencies in India. Pursuant to the said circular, Ind-Ra has revised its rating symbols and their definitions, which will be used for all outstanding issuer default ratings (IDR) and outstanding instruments rated/assigned.

The revised rating symbols and their definitions are as follows:

 

Ind-Ra Rating Scale for Long Term Debt Instruments [the instruments with original maturity exceeding one year]

 

IND AAA

Instruments with this rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

IND AA

Instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk.

IND A

Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.

IND BBB

Instruments with this rating are considered to have moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk.

IND BB

Instruments with this rating are considered to have moderate risk of default regarding timely servicing of financial obligations.

IND B

Instruments with this rating are considered to have high risk of default regarding timely servicing of financial obligations.

IND C

Instruments with this rating are considered to have very high risk of default regarding timely servicing of financial obligations.

IND D

Instruments with this rating are in default or are expected to be in default soon.

Note: Modifiers {"+" (plus) / "-"(minus)} can be used with the rating symbols for the categories IND AA to IND C. The modifiers reflect the comparative standing within the category.

 

Ind-Ra Rating Scale for Short Term Debt instruments [the instruments with original maturity of up to one year]

 

IND A1

Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

IND A2

Instruments with this rating are considered to have strong degree of safety regarding timely payment of financial obligations. Such instruments carry low credit risk.

IND A3

Instruments with this rating are considered to have moderate degree of safety regarding timely payment of financial obligations. Such instruments carry higher credit risk as compared to instruments rated in the two higher categories.

IND A4

Instruments with this rating are considered to have minimal degree of safety regarding timely payment of financial obligations. Such instruments carry very high credit risk and are susceptible to default.

IND D

Instruments with this rating are in default or expected to be in default on maturity.

Note: Modifier {"+" (plus)} can be used with the rating symbols for the categories IND A1 to IND A4. The modifier reflects the comparative standing within the category.

 

Ind-Ra Rating Scale for Long Term Structured Finance Instruments [the instruments with original maturity exceeding one year]

 

IND AAA(SO)

Instruments with this rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

IND AA(SO)

Instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk.

IND A(SO)

Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.

IND BBB(SO)

Instruments with this rating are considered to have moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk.

IND BB(SO)

Instruments with this rating are considered to have moderate risk of default regarding timely servicing of financial obligations.

IND B(SO)

Instruments with this rating are considered to have high risk of default regarding timely servicing of financial obligations.

IND C(SO)

Instruments with this rating are considered to have very high likelihood of default regarding timely payment of financial obligations.

IND D(SO)

Instruments with this rating are in default or are expected to be in default soon.

Note: Modifiers {"+" (plus) / "-"(minus)} can be used with the rating symbols for the categories IND AA(SO) to IND C(SO). The modifiers reflect the comparative standing within the category.

 

Ind-Ra Rating Scale for Short Term Structured Finance Instruments [the instruments with original maturity of up to one year]

 

IND A1(SO)

Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligation. Such instruments carry lowest credit risk.

IND A2(SO)

Instruments with this rating are considered to have strong degree of safety regarding timely payment of financial obligation. Such instruments carry low credit risk.

IND A3(SO)

- Instruments with this rating are considered to have moderate degree of safety regarding timely payment of financial obligation. Such instruments carry higher credit risk as compared to instruments rated in the two higher categories.

IND A4(SO)

Instruments with this rating are considered to have minimal degree of safety regarding timely payment of financial obligation. Such instruments carry very high credit risk and are susceptible to default.

IND D(SO)

Instruments with this rating are in default or expected to be in default on maturity.

Note: Modifier {"+" (plus)} can be used with the rating symbols for the categories IND A1(SO) to IND A4(SO). The modifier reflects the comparative standing within the category.

 

Ind-Ra Rating Scale for Long Term Debt Mutual Fund Schemes [the debt mutual fund schemes that have an original maturity exceeding one year]

 

IND AAAmfs

Schemes with this rating are considered to have the highest degree of safety regarding timely receipt of payments from the investments that they have made.

IND AAmfs

Schemes with this rating are considered to have the high degree of safety regarding timely receipt of payments from the investments that they have made.

IND Amfs

Schemes with this rating are considered to have the adequate degree of safety regarding timely receipt of payments from the investments that they have made.

IND BBBmfs

Schemes with this rating are considered to have the moderate degree of safety regarding timely receipt of payments from the investments that they have made.

IND BBmfs

Schemes with this rating are considered to have moderate risk of default regarding timely receipt of payments from the investments that they have made.

IND Bmfs

Schemes with this rating are considered to have high risk of default regarding timely receipt of timely receipt of payments from the investments that they have made.

IND Cmfs

Schemes with this rating are considered to have very high risk of default regarding timely receipt of timely receipt of payments from the investments that they have made.

Note: Modifiers {"+" (plus) / "-"(minus)} can be used with the rating symbols for the categories IND AAmfs to IND Cmfs. The modifiers reflect the comparative standing within the category

 

Ind-Ra Rating Scale for Short Term Debt Mutual Fund Schemes [the debt mutual fund schemes that have an original maturity of up to one year]

 

IND A1mfs

Schemes with this rating are considered to have very strong degree of safety regarding timely receipt of payments from the investments that they have made

IND A2mfs

Schemes with this rating are considered to have strong degree of safety regarding timely receipt of payments from the investments that they have made.

IND A3mfs

Schemes with this rating are considered to have moderate degree of safety regarding timely receipt of payments from the investments that they have made.

IND A4mfs

Schemes with this rating are considered to have minimal degree of safety regarding timely receipt of payments from the investments that they have made.

Note: Modifier {"+" (plus)} can be used with the rating symbols for the categories IND A1mfs to IND A4mfs. The modifier reflects the comparative standing within the category.

 

A rating symbol can be suffixed by any of the special symbols given below, except in case of a provisional rating where the rating symbol will be prefixed by the special symbol.

 

suspendedSignifies rating placed in suspended category due to lack of adequate information
ProvisionalSignifies that a full rating has been provisionally assigned based on our expectation regarding final documentation, typically based on a review of the final draft documentation provided by the issuer
emrSignifies exclusion of embedded market risk from the rating
Signifies rating watch positive
Signifies rating watch negative
Signifies rating watch evolving

Disclaimer

Copyright © 2016 Fitch Ratings, Inc., Fitch Ratings, Ltd. and its subsidiaries. 33 Whitehall Street, NY, NY 10004.Telephone: 1-800-753-4824, (212) 908-0500. Fax: (212) 480-4435. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved. In issuing and maintaining its ratings, India Ratings and Research (Ind-Ra) relies on factual information it receives from issuers and underwriters and from other sources Ind-Ra believes to be credible. Ind-Ra conducts a reasonable investigation of the factual information relied upon by it in accordance with its ratings methodology, and obtains reasonable verification of that information from independent sources, to the extent such sources are available for a given security or in a given jurisdiction. The manner of Ind-Ra's factual investigation and the scope of the third-party verification it obtains will vary depending on the nature of the rated security and its issuer, the requirements and practices in the jurisdiction in which the rated security is offered and sold and/or the issuer is located, the availability and nature of relevant public information, access to the management of the issuer and its advisers, the availability of pre-existing third-party verifications such as audit reports, agreed-upon procedures letters, appraisals, actuarial reports, engineering reports, legal opinions and other reports provided by third parties, the availability of independent and competent third-party verification sources with respect to the particular security or in the particular jurisdiction of the issuer, and a variety of other factors. Users of Ind-Ra's ratings should understand that neither an enhanced factual investigation nor any third-party verification can ensure that all of the information Ind-Ra relies on in connection with a rating will be accurate and complete. Ultimately, the issuer and its advisers are responsible for the accuracy of the information they provide to Ind-Ra and to the market in offering documents and other reports. In issuing its ratings Ind-Ra must rely on the work of experts, including independent auditors with respect to financial statements and attorneys with respect to legal and tax matters. Further, ratings are inherently forward-looking and embody assumptions and predictions about future events that by their nature cannot be verified as facts. As a result, despite any verification of current facts, ratings can be affected by future events or conditions that were not anticipated at the time a rating was issued or affirmed.  

The information in this report is provided "as is" without any representation or warranty of any kind. An Ind-Ra rating is an opinion as to the creditworthiness of a security. This opinion is based on established criteria and methodologies that Ind-Ra is continuously evaluating and updating. Therefore, ratings are the collective work product of Ind-Ra and no individual, or group of individuals, is solely responsible for a rating. The rating does not address the risk of loss due to risks other than credit risk, unless such risk is specifically mentioned. Ind-Ra is not engaged in the offer or sale of any security. All Ind-Ra reports have shared authorship. Individuals identified in a Ind-Ra report were involved in, but are not solely responsible for, the opinions stated therein. The individuals are named for contact purposes only. A report providing a Ind-Ra rating is neither a prospectus nor a substitute for the information assembled, verified and presented to investors by the issuer and its agents in connection with the sale of the securities. Ratings may be changed or withdrawn at anytime for any reason in the sole discretion of Ind-Ra. Ind-Ra does not provide investment advice of any sort. Ratings are not a recommendation to buy, sell, or hold any security. Ratings do not comment on the adequacy of market price, the suitability of any security for a particular investor, or the tax-exempt nature or taxability of payments made in respect to any security. Ind-Ra receives fees from issuers, insurers, guarantors, other obligors, and underwriters for rating securities. Such fees generally vary from US$1,000 to US$750,000 (or the applicable currency equivalent) per issue. In certain cases, Ind-Ra will rate all or a number of issues issued by a particular issuer, or insured or guaranteed by a particular insurer or guarantor, for a single annual fee. Such fees are expected to vary from US$10,000 to US$1,500,000 (or the applicable currency equivalent). The assignment, publication, or dissemination of a rating by Ind-Ra shall not constitute a consent by Ind-Ra to use its name as an expert in connection with any registration statement filed under the United States securities laws, the Financial Services and Markets Act 2000 of the United Kingdom, or the securities laws of any particular jurisdiction. Due to the relative efficiency of electronic publishing and distribution, Ind-Ra research may be available to electronic subscribers up to three days earlier than to print subscribers.