The Rebirth of CARE Ratings Limited

“The domestic fundamentals are showing gradual improvement and the private investment is expected to revive with capacity utlisation level inching towards 75%. However, India’s economy needs to brace up for prevailing headwinds in the form of slowing global growth, high inflation and tighter liquidity for a major part of the current financial year. The global uncertainties, high commodity prices and rising interest rates would be dampening factors for investor sentiments. This notwithstanding, our initial ratings business witnessed good growth from the bank loan ratings and securitization segments.”

– Mehul Pandya, Managing Director & CEO

Company Description:

CareEdge Ratings is one of the leading credit rating agencies. The company’s ratings business focuses on several sectors including the Infrastructure sector and the BFSI Sector. The company has developed an expertise in developing several financial instruments as well. Additionally, CareEdge conducts real time research on various studies and projects. The company has wholly owned subsidiaries: Care Advisory, Research & Training Ltd. and Care Risk Solutions Pvt Ltd. The company also has various business arrangements with international rating agencies. 

The company has gone through significant changes in management and strategy to improve the company’s long term growth prospects.

Rebranding:

The company has recently undergone a major rebranding exercise. The company has decided to present itself as a technology driven firm that directs all its resources to gather information and knowledge efficiently.

To keep in line with this vision the company has observed a major technological change:

The company is looking into several Machine Learning models and NLPs to automate lower level data entry work to ensure efficiency in processes while expanding the company’s market surveillance capacity. The company has shifted from an in – house data centre and have taken steps to increase their cybersecurity. 

The company has also taken steps to create a comprehensive platform named ‘Sirius’. The platform provides integrated data on all sorts of financial research or reports to banks, mutual funds or FPIs. 

Building Resilient Subsidiaries:

Care Ratings (Africa) Private Limited has observed a strong performance financially in the fiscal year 2022. The company has made significant headway in Mauritius and plans to leverage their existing knowledge and technological base to expand the business in other African markets.

Care Ratings Nepal Private Limited provide a wide variety of services in Nepal. After the pandemic downturn, the company has seen a 7.2% increase to ₹ 5.13 crores in total income in the fiscal year 2022.

Care Advisory, Training and Research Ltd. provides services in the domain of corporate advisory and infrastructure project evaluations. The company also provides credible and customised research reports to clients through its research division.

Care Risk Solutions Private Limited has expanded its range of product offerings by inculcating and upgrading their technological infrastructure. 

Financial Performance:

₹ in Cr.	Q1FY23	Q1FY22	% Change
Total Revenue	62.09	56.52	10%
Total Expenses	40.89	42.55	(4%)
Profit Before Tax	21.20	13.98	52%
Profit After Tax	14.14	11.55	22%

This quarter’s result showed a strong positive shift from the corresponding quarter of the previous year.