Moody & #39;S May Up Icra Stake

Moody's Investor Services, the leading rating agency in the world, is looking at increasing its stake in domestic credit rating agency Icra Ltd from the current 12 per cent to 20 per cent.

According to sources, a team of senior functionaries from Moody's is expected to visit the company shortly and the matter might come up for discussion then.

Moody's is the second-largest shareholder in Icra after the Industrial Finance Corporation of India (IFCI) which owns a 26 per cent stake. In 1999, it had acquired an 11.36 per cent stake in Icra for a consideration of Rs 6 crore. The shares are held by Moody's Investmnt Company India (Pvt) Ltd.

Apart from IFCI and Moody's, the shareholders of the domestic rating agency include banks such as the State Bank of India, Punjab National Bank and Central Bank of India, insurance companies Life Insurance Corporation and General Insurance Corporation of India, Housing Development Finance Corporation of India and Infrastructure Leasing & Financial Services Ltd.

Apart from the equity stake, Icra has a technical services agreement with Moody's which entails providing certain high-level technical services to Icra.

Specifically, the accord is aimed at helping Icra's in-house research capabilities and provide it access to Moody's global research base. Under the agreement, Moody's also had provided training to analysts at Icra.

Icra has also been working with Moody's Risk Management Services, a subsidiary of Moody's Investors Services, for extending state-of-the-art technology in credit risk management for banks and other lenders.

The range of services of Icra includes rating services, information services and advisory services. While the rating services division rates rupee-denominated debt instruments issued by companies, municipalities and others, the information services division focuses on providing authentic data and value-added products to a slew of users, and the advisory services division offers wide-ranging management advisory services including strategic counselling and restructuring solutions.