Icra Launches Construction Sector Ratings
For the first time in Indian construction industry, the Investment Information and Credit Rating Agency (Icra) has assigned various grades to seven companies related to the sector.
Icra assigned `CR1' grade to L&T (ECC), the construction division of engineering major Larsen & Toubro (L&T), `CR2' to Petron Civil Engineering Ltd and `CR3+' to Ganesan Builders Ltd.
The other two construction companies, Continental Construction Ltd and Soma Enterprise Ltd, have been accorded `CR2-' and `CR2' grades, respectively.
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The two consulting firms - MCM Services Private Ltd and Swar Ship Properties Ltd - have been assigned `CT3' and `CT 3+' grades, respectively, under grading scale for consultants.
The grade, `CR1' indicates vary strong contract execution capacity of a contractor, whereas `CR2' and `CR3' grades respectively indicate strong and moderate contract execution capacities of the contractor, according to Icra executive director Amul Gonga.
Inadequate and weak contract execution capacity of a contractor is indicated by `CR4' and `CR5,' he said adding the suffix `+' or `-'' may be appended to a grade to indicate the relative standing within that grade.
Icra, in association with Construction Industry Development Council has developed a methodology to evaluate all players in a construction project.