Policy on Provisional Ratings

Last Reviewed On: December 30, 2016

  • Provisional Ratings:
    • Provisional ratings are assigned by Acuité to debt instruments where certain important actions and/or execution of certain documents governing the ratings are yet to be completed. These actions / steps may comprise execution of the guarantee deed by the group / parent company or Government, appointment of debenture trustee, finer details regarding the structured payment mechanism and other factors based on which the rating is assigned.
    • Subsequently, upon execution of the requisite documents / completion of the required actions, the provisional ratings are converted into final ratings.
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  • Symbol for Provisional Ratings:
  • In case of provisional ratings, Acuité prefixes such ratings with the word provisional e.g. "Provisional ACUITE A (SO)”.

     

  • Conversion of Provisional Ratings into Final Ratings:
  • Acuité shall convert the provisional ratings into final ratings as and when the terms such as execution of documents / complying with the conditions etc., as envisaged at the time of assignment of provisional ratings are fulfilled within the agreed time frame.

     

  • Time frame for complying with the agreed terms, execution of documents and withdrawal of ratings:
    • Acuité shall disseminate the provisional ratings through its website and provide three months time for the issuer to execute various documents / complete the formalities. However, if the requisite steps are not taken and/or the formalities are not completed, within the agreed time frame, Acuité may extend the time frame and simultaneously extend the Provisional Rating’s validity period depending on the circumstances. The extended time period shall not be more than 6 months from the date of assignment of provisional rating.
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    • If the issuer fails to comply with the documentation requirement / does not take the required action within the extended time period, as indicated at D (i), Acuité depending on the circumstances may:
      • withdraw the rating; or
      • place the provisional rating on rating watch; or
      • extend the provisional rating for a further period as considered prudent.
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    • In case the requisite documentation is not completed even within the extended period, Acuité shall undertake a review of the provisional rating and take an appropriate rating action.
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    Acuité reserves the right to reaffirm / revise the provisional rating depending on the developments, financials of the rated / guaranteeing entity and/or other factors.

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Our exciting journey started in 2005 with rating of bank borrowers most of whom were small and medium enterprises. At that time, credit rating was a concept known only to large issuers of capital market instruments. Since then, like a caterpillar transforms itself into a beautiful butterfly, we transformed to rate bonds, bank facilities of large corporates and issuers across industries. Along came many achievements - SEBI Registration in 2011, RBI accreditation in 2012, 50,000 ratings in 2018, 5,000 Bond and Bank Loan Ratings in 2017, launch of India's first Android and iPhone app to disseminate rating, tamper-proof QR-code-enabled rating rationales, and SMERA Terminal to name a few.

Now is the time to re-emphasize our increasing footprint across all segments of ratings through the launch of our new name - 'Acuité'.

The name has changed. The spirit of upholding highest standards of analytical rigour, continuous improvement, excellence in our processes and quest for innovation remains the same. We would like to re-emphasize that we will continue to work hard to provide independent, unbiased and timely opinion of highest standard.

Acuité means 'sharpness and clarity of thought and vision'. Let our research and ratings help you take decisions with confidence.


Sankar Chakraborti
CEO