CRISIL eyes equity research of mid-cap companies

Wednesday, September 30, 2009, 12:46
Microfinance Ratings
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Microfinance Focus, Sept. 30, 2009: Rating agency CRISIL has formally announced its entry into independent equity research aimed at covering those companies which are not as big as the top 100 in the country.

Releasing the first set of CRISIL’s Independent Equity Research (IER) reports at a function in Mumbai on Tuesday, SEBI chairman C. B. Bhave said, “Independent equity research will introduce an unbiased analytical perspective on a company, independent of market players who may have an interest in a transaction. It should also help improve the quality of research on Indian companies.”
Explaining the new service, Ms. Roopa Kudva, Managing Director and CEO, CRISIL Ltd, said, “This initiative is part of our constant endeavour to serve the market with innovative offerings. Through CRISIL IER, we aim to deliver high-quality independent equity research, and expand the coverage available for small and mid cap companies.”

CRISIL IER will cover two key parameters in the investment process: fundamentals (Fundamental Grade) and valuation (Valuation Grade) on a five-point scale, with 5 being the highest grade, and 1 the lowest. A detailed equity research report on companies explaining the grades will be made available on CRISIL IER’s website.
Since a survey by CRISIL indicated that only the top 100 of around 3,500 active listed companies receive in-depth equity research coverage. CRISIL IER will focus to help the remainder of the companies to become visible to a wider audience.

CRISIL IER will also provide guidance to investors on company fundamentals, which can be used by them in conjunction with their personal risk appetites, and price and return calculations.

CRISIL Research operates independently and does not have access to information obtained by CRISIL’s Ratings Division, clarified the company.