INSUBCONTINENT EXCLUSIVE:
MUMBAI: Regulators including the Securities Exchange Board of India (Sebi) and the Reserve Bank of India (RBI) are examining a possible
relaxation in the time period that rating companies are provided to upgrade a firm following a downgrade.
Given that improvement in the
financial position of a corporate could be as swift as it deteriorated due to the lockdown, rating firms now want the time taken to upgrade
between one and three months, from the current 3 to 12 months.
A group of seven rating companies is said to have approached the two
regulators that are working on the proposal, three people with the direct knowledge of the matter told ET.
Sebi and RBI did not reply to
said one of the persons cited above
Sebi is said to be considering such a proposal to allow this for one year, while RBI is still deliberating over it, sources said.
Company
Joydeep Sen, consultant with Phillip Capital India
company is downgraded under a high-yield category, which begins from BB+ grade, the company cannot be upgraded in the next three months
agencies have downgraded 564 companies until April 20 compared with 51 upgrades, showed an industry estimate
The number of downgrades is expected to rise.
