1. THE INTERNSHIP
IN
CRISIL RATING
FROM 8 MAY-23JUNE,2013
BY
SUMIT
1.
MALHOTRA
BD TRAINEE

2. CRISIL Businesses
1)Rating
2)Global research and analytics
3)Research
4)CRISIL risk and infrastructure solution
2.

3. CRISIL’s SME Rating Services
ldh
.

4. Key Messages
• Meaning of SME Rating
• About CRISIL
• SME rating products from CRISIL
• Benefits of rating to SMEs
• Are ratings helping SMEs? Feedback from a CRISIL survey
• Rating process
• Fee structure
4.

5. Meaning of SME Rating
• A reflection of level of creditworthiness and business
capabilities of an SME in relation to other SMEs
• Comprehensive analysis of financial strength as well as
performance capabilities
• Feedback from customers, suppliers and bankers - a 360
degree check
5.

6. About CRISIL

7. CRISIL’s Credentials
•
India’s largest and most influential rating agency
•
Officially recognized by RBI for Basel II ratings
•
Subsidiary of Standard & Poor’s (the world’s leading rating
agency)
•
Fourth largest credit rating agency in the world and largest in
India
•
Enjoys very high credibility
•
Pioneer and market leader
A rating that is highly trusted in the market
7.

8. CRISIL’s presence in SME sector
• Present in more than 100 locations across India and a 150
member strong team.
• Rated 5300 SMEs/SSIs.
• SME award with ICICI and CNBC (Emerging India Awards) –
35,000 entries. More than 1,30,000 entries received in 2007
8.

9. CRISIL’s presence……
• MOU with 38 banks – State Bank of India, Canara Bank,
Punjab National Bank, Punjab& Sind Bank, Bank of Baroda,
UCO Bank, Corporation Bank, Indian Overseas Bank, United
Bank of India, SBM, SBT, State Bank of Indore, Allahabad
Bank, Syndicate Bank, HDFC Bank, Federal Bank, Indian Bank,
Dena Bank, Bank of India, Andhra Bank, State Bank of
Hyderabad, Bank of Maharashtra, Union Bank of India and
Vijaya Bank
• Central Bank, Punjab & Sind Bank and TMB accept rating.
• In dialogue with a number of other banks for similar tie-up
• Interest rate incentive from Canara Bank, BOI, UCO,
PNB,United Bank, Union Bank, Corporation Bank, Vijaya Bank,
Syndicate Bank and TMB ,Sbi,ICICI,Axisthank you
bank , HDFC bank,
9.

10. Why SME ratings now?
•SMEs’ keenness to benchmark themselves against their peers
- gives insight into the business
•Pressures of business growth and challenges of competition
•A powerful signal of transparency and credibility - exports
•Government support to make rating affordable
•‘Bankers to charge interest keeping in view the rating acquired
by SMEs’- Finance Ministers’ budget speech
10.

11. brief financial of CRISIL
Period ending (months)
31-Mar-2013(3)
31-Dec-2012
31-Dec-2011
1881.20
7366.00
6391.56
Other Income
37.60
202.60
227.53
Total Income
1918.80
7568.60
6619.09
Cost of goods sold
1233.30
4650.30
4129.23
OPBDIT
685.50
2918.30
2489.86
PAT
456.00
1928.80
1865.12
-
-
-
70.20
70.20
70.06
EPS (Rs.)
-
27.49
26.28
DPS (Rs.)
-
-
-
BV (Rs.)
-
-
-
P/E range (x)
-
31.03 - 45.90
28.54 - 340.37
Debt / Equity (x)
-
-
-
Operating margin (% of OI)
35.7
38.6
37.6
Net margin (% of OI)
23.8
25.5
28.2
Net sales
Gross Block
Equity capital
http://www.myiris.co.in/shares/company/snapShotShow.php?icode=CRERATIS
11.

12. Rating benefits for SMEs

13. CRISIL SME Rating – Benefits for SME/SSIs
For SMEs
• A trusted third party opinion
• Access to funding
 Faster – time saving
 Appropriate interest rate and other termss
• Credibility with business partners
 New customers/Suppliers/Collaborators
• Tool for self improvement
 Gives a comparative benchmark, strengths/weaknesses
• Visibility - Listing in CRISIL publications and website
13.

14. Rating services
CRISIL’s SME Rating Scale
for larger SMEs
CRISIL SME Rating
NSIC-CRISIL Rating Scale for
SSIs
Definition
Financial Strength
Highest
SME 2
High
SME 3
Above Average
SME 4
Average
SME 5
Below Average
SME 6
Inadequate
SME 7
Poor
SME 8
Default
High Moderate Low
Highest SE 1A
Performance
Capability
SME 1
SE 1B
SE 1C
SE 2A
SE 2B
SE 2C
Moderate SE 3A
SE 3B
SE 3C
High
Weak
SE 4A
SE 4B
SE 4C
Poor
SE 5A
SE 5B
SE 5C
SME/SSI - Green field projects rated on unique model
14.

15. Are ratings really helping SMEs?

16. Are ratings really helping ?
•Some of the key conclusions were
– Ratings are helping SMEs/SSIs in a variety of ways including better
commercial terms as well as for credibility building
– Many SMEs are also using the rating report analysis as a tool for self
improvement
– CRISIL appears to be a strong first choice given its strong credibility in
Indian financial markets
16.

17. Feedback from Clients
•
“We would be using the report bank appraisals and investors. We are quite satisfied with
the work done by CRISIL, and find the rating very good and useful.” – Xytel India Pvt. Ltd.
•
“Thank you for a very positive report. The strengths and weakness of the company,
notes at the end of the table where necessary put the information in the right business
context , information about competitors, industry overview , graphical representation
give a true picture of what is happening. “ – STJ Electronics
•
This rating comes as a real surprise to us, as initially we thought that it would be useful
only from the perspective of the banks. However, we got good response from market as
everybody is aware about the rating of Crisil. We are very happy and satisfied with the
way process was carried out.” – Lexi Pens
•
“Its good, now we will work on this rating any try to improve upon the factors, as
mentioned by CRISIL.” – HGS (India) Limited
•
“Overall we are happy with rating.” – CICO Technologies
•
“The rating from CRISIL has helped us to negotiate better terms with our bankers. Rating
will help us in the growth process.”- Holostik
17.

18. Rating process

19. Collect & process information
Step 1: Collect and process preliminary information
Site visit
conducted by
an associate
Request for
rating received
Preliminary
information
collected by
the associate
19.
Papers sent to
CRISIL
analysts

20. Analyse and assign the rating
Step 2: Analyse and assign the rating
Papers received from
associates
Rating is assigned by
the committee
Information checked
Report prepared and
sent to a rating
committee
by CRISIL analysts
Background research
is done
20.
Management
discussion over a
conference call

21. Communicate & publish rating
Step 3: Communication and publication of the rating
Draft report sent to
the client to check for
any factual
inaccuracies
Changes, if any,
received from the
client and made
21.
Rating is published on
the website with the
prior approval of the
client
Final report, rating
letter and a rating
certificate sent to the
client

22. CRISIL Rating report
CONTENTS
NSIC-CRISIL PERFORMANCE AND CREDIT
RATING GRID
FACT SHEET
STRENGTH AND RISK FACTORS
MANAGEMENT PROFILE
FUTURE PLANS
OWNERSHIP PATTERN
MANUFACTURING FACILITIES
BUSINESS PROFILE
PRODUCT PROFILE
CAPACITY UTILISATION
SUPPLIER INFORMATION
CUSTOMER INFORMATION
ORDERS IN HAND
MARKETING ARRANGEMENTS
OTHER INFORMATION
INDUSTRY REVIEW
BANK AND INSURANCE DETAILS
FINANCIAL PERFORMANCE
PROFIT AND LOSS ACCOUNT
GRAPHS
BALANCE SHEET
KEY RATIOS
SITE VISIT INFORMATION
PROMOTERS’ DETAILS
22.

23. Fee Structure
NSIC-CRISIL Fee Structure
Turnover (Rs lakh)
up to 50
Normal
50 - 200
Concession
Normal
above 200
Concession
Normal
Concession
Rating Fees (Rs.)
40,000
27,040
45,000
36,000
60,000
48,000
Service Tax (Rs.)
4,944
3,342
5,562
4,450
7,416
5,933
Total Fees (Rs.)
44,944
30,382
50,562
40,450
67,416
53,933
Subsidy from NSIC
(Rs.)
25,000
22,786
30,000
30,000
40,000
40,000
Amount payable by
SSIs (Rs.)
19,944
7,596
20,562
10,450
27,416
13,933
Concessional fees**
9157
62%
12017
49%
16023
49%
23.

24. Fee Structure
SME Ratings Fee Structure(basel2 rating)
Turnover (Rs crore)
Up to 10
Normal
above 10 up to 25
Con.
Normal
Con.
above 25 up to 50
Normal
Con.
above 50 up to 75
Normal
Con.
above 75
Normal
Con.
Rating Fees (Rs)
40,000
30,000
45,000
40,500
50,000
45,000
75,000
67,500
100,000
90,000
Service Tax (Rs)
4,944
3,708
5,562
5,006
6,180
5,562
9,270
8,343
12,360
11,124
Total Fees (Rs.)
44,944
33,708
50,562
45,506
56,180
50,562
84,270
75,843
112,360
101,124
Discount to
SMEs
24.
25%
10%
10%
10%
10%

25. Scheme of MSME,NSIC
for MSMe’s
1)Credit linked subsidy scheme
2)Credit guarantee for micro &
small enterprises
3)Reimbursement scheme for ISO9000/ISO-14001/HAPPC
certification

26. 4)Purchase and price preference to MSME sector in govt.
Purchase
5)MSE cluster Development programme
6)Lean Manufacturing Competitiveness Scheme
7)NSIC Raw Material Assistance Scheme for Procurement
of raw material
26.

27. 8) NSIC’s short term finance scheme for procurement of any raw
material
9)NSIC’s government store purchase programme
10)NSIC’s Consortia/tender Marketing scheme
11)Credit facilitation through tie up arrangement with banks
12)NSIC’s info mediary service /b2b
13)Participation in exhibition domestic/overseas
14)Performance & credit rating scheme for MSMEs
27.

28. Learning from internship
1)Be aggressive towards work
2)Pitch where the person is interested
3)Subsidy & free are those terms where every
one thinks
4)Give a quality service
5)Some times try to use the name of big fish
in place of selling product
6)Be confident
7)Convincing power should be strong
28.

29. www.crisil.com
CRISIL Limited
121-122, Andheri-Kurla Road
Andheri(E), Mumbai-400 093
Tel-022-66913312/9322123311.
Email-avarghese@crisil.com
29.

30. Thank you
30.