Icici Bonds Rated Aaa

Credit Analysis and Research Ltd (CARE) has assigned a AAA rating to the proposed Rs 750-crore unsecured bond issue of Industrial Credit and Investment Corporation of India (ICICI). The rating indicates that the instrument classifies as high investment grade.

ICICI is one of the leading development financial institutions and its operations cover the entire gamut of financial services.

By March 1996, it had assisted almost 5000 companies in over 13,000 projects, involving cumulative disbursements of Rs 36,590-crore. Its operating income and profits have grown at a compounded annual growth rate of over 25 per cent in the past three years. The institutions capital adequacy ratio was 10.1 per cent as on March 31, 1996.

 

In August 1996, ICICI raised $230 million through a GDR issue, which would improve the capital adequacy ratio. After the institutions proposed merger with SCICI the networth of the institution will be Rs 4000 crore with an asset base of over Rs 33,000 crore.

With the opening up of the infrastructure sector for private investment, the overall demand for resources is expected to grow sharply in the medium term. However, with the recent slowdown in the growth rate in some industrial sectors and the prevailing high rates of interest, the pace of investment and the demand for funds from financial institutions are also slowing down.