Rating methodology of Infomerics ratings is analysed by quantitative and qualitative factors affecting the credit quality of the issuer company. It varies as per the sectors like manufacturing companies, trading companies, service sector companies, banks, NBFCs, public finance, infrastructure companies, issuer rating, bank loan ratings, rating of mutual fund, investment fund etc. Infomerics rating methodology issue rating on factors including Industry Overview, Business Risks, Financial Risks and Management Risks. However, it is known as bank loan rating which is used to determine risk factors for the companies financial purposes and loan exposures. Infomerics is a SEBI registered company and accredited by Reserve Bank of India.
Bank Loan Ratings is used by banks to determine risk weights for their loan exposures, in line with the Reserve Bank of India's Guidelines for Implementation of the New Capital Adequacy Framework under Basel II framework. Infomerics rates all types of fund-based and non-fund based facilities sanctioned by Banks. This would include cash credit, working capital demand loans, Letter of Credit, Bank guarantees, Bill discounting, Project loans, Loans for general corporate purposes etc. The primary focus of the rating exercise is to assess future cash generation capability and their adequacy to meet debt obligations as per the repayment terms. The analysis therefore attempts to determine the fundamentals of the business and the industry and the probabilities of change in these fundamentals, which could affect the credit worthiness of the borrower.