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Trends in Credit Rating Industry in India

Source – ZebraResearch, Axis Capital , Page no – 62

  • It is also time to rate rating agencies themselves.

  • A form of an ‘investor pays’ model can be considered by SEBI, where the rating fee is borne by all investors who subscribe to debt issuance, in proportion to the size of their bids.

 

Figure 1.1

Extract Source – RBI

 

Figure 1.2

 

Extract Source – Credit Rating Agencies by Axis Capital, Page no – 66

 

Extract Source – Credit Rating Agencies by Axis Capital, Page no – 66

Extract Source – Credit Rating Agencies by Axis Capital, Page no – 67

 

Global Trends –

 

Extract Source – ZebraResearch, Report on CARE Ratings, Page no – 6

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Factors that indicate a healthy growth in the Exchange industry are
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2. Shift from physical assets to financial assets (eg. mutual funds)
3. Increase retail participation
4. Govt approval for EPFO to invest in equity market
5. Growth of data related business
6. Development of corporate bond market
7. Development of International Exchange

Market Size of Credit Rating In India

The market size of Credit Rating Industry in India is directly related to the size of the overall bond market. The Credit Rating Industry Size should be understood as a percentage of overall bond market.

FY20 Bonds Issued in India – 309,332 (INR Billion)

Revenue of top 3 rating agencies in India from Rating and allied services in FY20 – Rs. 1002 crores.

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