Does corporate India need more than one credit rating agency?
If there are four agencies, there might be four different views. They might not be very divergent views, but there could be a difference in the rating — one agency could approve an A rating while the others might give it an A plus (A+) or an A minus (A-). But I do believe that having too many rating agencies may not be very healthy. This is because the market is limited to the same 500-1,000 companies. If these four credit rating agencies compete in this market, it could lead to very unhealthy practices, wherein I start selling my agency. And this is not a good thing at all. Credit ratings facilitate investment decisions. So, in one sense, don’t you think downgrading a company in times of recession may further hurt it and the economy as a whole? We are not in the business of building companies. We are in the business telling investors that this is the risk associated with this investment, based on certain assumptions valid on a particular date. We think we have better expertise in ana
