ICRA Limited, formerly known as Investment Information and Credit Rating Agency of India Limited, is an Indian credit rating agency. It provides ratings and information services.
Here's a more detailed breakdown:
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Origin and Establishment: ICRA was established in 1991 by leading financial institutions, commercial banks, and financial service companies. This diverse backing aimed to create an independent and professional credit rating agency in India.
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Purpose: ICRA serves as a vital resource for investors and lenders by providing independent assessments of the creditworthiness of companies and debt instruments.
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Services Offered: The primary service offered by ICRA is credit rating. This involves evaluating the ability of a company or a specific debt instrument (like bonds or loans) to repay its financial obligations. These ratings help investors make informed decisions about the risks associated with investing in these entities or instruments. Besides credit ratings, ICRA offers grading, research, and other advisory services.
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Importance: Credit rating agencies like ICRA play a significant role in the financial system. They enhance transparency, reduce information asymmetry, and contribute to the efficient allocation of capital. Their ratings influence borrowing costs, investment decisions, and overall market stability.
In summary, ICRA is a leading credit rating agency in India, providing independent assessments of credit risk to help investors and lenders make informed financial decisions.
