Credit Rating Agencies - Sector Update - Centrum 18062014.pdf

8/10/2019 Credit Rating Agencies - Sector Update - Centrum 18062014.pdf

1/8Centrum Equity Research is available on Bloomberg, Thomson Reuters and FactSet

Unlisted rating agencies and bankers sound optimisticOur interaction with managements of (unlisted) credit rating agencies (CRA), which

we present in a Q&A form, indicated early signs of revival in investment, raisingprospects of improvement in rating revenues, led partly by increase in blendedyields (more from outside bank loan ratings). Though the risk of attrition remainsand CRAs will have to price their assets (employees) accordingly, loss of revenue dueto migration to internal rating approach (IRB) by banks is unlikely to be debilitatingin the immediate future. Bankers too agreed with this assessment. We retain ourpositive stance on the sector and retain Buy on CARE and Hold on CRISIL.

Revenue mix to move away from bank loan rating: With relatively nascent MSMEratings and highly under-penetrated corporate bond market, experts believe bankloan rating (BLR) constitutes 50%+ of systemic rating revenues currently. Withefforts to revive the corporate bond market and MSME ratings, experts say that inthe next 3-4 years, these segments will account for ~75% of total revenues. Theshift in revenue mix will also enable CRAs to mitigate the risk of revenue loss from

migration to internal rating based approach (Basel-II norms) by the banks. Pricing situation competitive, but improvement expected: Moderation in

systemic volumes# and competitive pricing saw the six CRAs garner just 12% CAGRin their rating revenues over FY11-14. While pricing situation in the BLR businesswill remain competitive with gradual improvement in better yielding corporatebond market (investor-pay model), overall blended yields are expected to inchupwards. MSME rating is the next big opportunity and experts pointed out that atleast 60% of initially rated MSMEs have renewed their ratings in subsequent years.

Risk of migration to IRB approach limited in immediate future:Interaction withbankers (both private and PSU) suggests limited risk of revenue loss from migrationto IRB approach in the immediate future. While private banks (in general) have aninternal ratings approach in place, they are yet to adhere to regulatory norms. PSU

banks, barring large ones, continue to struggle with other issues and will takelonger to meet RBI requirements. Experts believe only ~50% of banks will be able tomigrate to IRB approach in the next 3-years.

Outlook and preference: We factor in 17% CAGR in rating revenue growth forboth CARE and CRISIL over FY14-16E led partly by improvement in volumes andpartly pricing. We retain Buy on CARE given its superior returns profile andattractive valuations at 16.7x FY16E EPS, at 32% / 55% discount to ICRA and CRISIL.Valuations at 36.9x CY15E EPS for CRISIL are expensive relative to its historicvaluations, with limited risk-reward, though it has enjoyed a premium in the past.

# banking credit to industries and services sector and corporate bond issuances.

Stock Price Performance (%)*

Company Name 1 Mth 3 Mth 6 Mth 1 Yr

CARE 18.0 34.6 33.1 35.5

CRISIL 33.7 52.5 65.0 50.1ICRA 25.3 25.1 52.2 44.5

Nifty 6.1 17.3 23.0 21.3

Source: Bloomberg; *as on 17 June 2014

Aalok Shah,[email protected]; 91 22 4215 9075

CompanyName

RatingTarget

Price (Rs)Upside /

Downside (%)

EPS P/E (x) RoCE (%) RoE (%) Dividend yield (%)

FY14 FY15E FY16E FY14 FY15E FY16E FY14 FY15E FY16E FY14 FY15E FY16E FY14 FY15E FY16E

CARE Buy 1,150 19.2 44.4 48.7 57.6 21.8 19.8 16.7 39.2 38.9 41.9 28.3 28.0 30.2 2 .9 3.1 3.3

CRISIL* Hold 1,340 (18.7) 33.2 38.1 44.7 49.6 43.3 36.9 57.6 54.2 54.3 39.0 36.6 36.7 1 .6 1.5 1.9

Source: Company, Centrum Research Estimates* CRISIL is a Dec ending company.

Financials

Sector Update 18 June 2014

INDIA

Credit Rating Agencies


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Credit Rating Agencies2

Q: What are the regulatory requirements for setting up a CRA? Are there any entrybarriers?

A: Credit rating agencies are regulated by CRA Regulations,1999. They are subject to guidelines of SEBI(for bond rating), RBI (for bank loan rating) and National Small Industries Corporation NSIC (for MSMEratings). Test of independence, credibility, fit & proper are some of the pre-requisites for setting up acredit rating agency and hence entry barriers are negligible but the process is stringent.

SEBI grants license for 5-years in the initial period and if performance is satisfactory, it issues apermanent license.

The advent of BLR in 2008 made it mandatory for CRAs to acquire licenses from the RBI. Theprocess of licensing is stringent (as it requires track records, historical default statistics, validateddata efficiency etc) and hence takes longer for new entrants to acquire licenses.

NSIC is being set-up to promote MSME ratings and allows the units (rated) to avail of thesubvention scheme from the government in the initial year. Under the scheme, CRA gets Rs40,000or 75% (whichever is lower) of the initial rating fees reimbursed by the government agency.

Q: What opportunities does the market offer? What market share do the top 3 CRAsenjoy?

A: Rating revenues for all six rating agencies cumulatively stood at ~Rs9.4bn (FY14) with top-3 CRAsaccounting for 86% of the market share. There has been a decline in revenues, attributed tomoderation in funds raised by corporates under the bank route and also corporate bond issuances.Under-cutting has also affected revenues. However with gradual improvement in bond issuances andyields thereof, the industry can witness 15%+ CAGR in their rating revenues over the longer run.

Exhibit 1:Rating revenue market share (FY14)

Source: Companies, MCA, Centrum Research * CRISIL revenues include outsourcing rating revenues from S&P

Q: What is your view on revival in the corporate bond market and MSME ratings? Can it

help mitigate the risk of revenue loss due to migration to IRB approach by banks?A: With relatively nascent MSME ratings and highly under-penetrated corporate bond market, expertsbelieve that BLR currently comprises 50%+ of total rating revenues. Considerable efforts have beenmade to revive the corporate bond market that can be a driving factor going forward. Theimprovement in bond issuance though gradual will be driven by:

Inability of the banking system to meet capital requirements of corporates given their limitations

on a) ALM mismatch b) cautious approach adopted towards lending following huge spike instressed loans and c) weak capital position especially in the context of meeting Basel-III norms oncapital adequacy requirement.

Expectations of moderation in interest rates will prompt corporates to adopt the bond route overbank loans. Though, historically, there exists no direct correlation between interest spreads andbond issuance.

The recent buoyancy in the capital market could see corporates resort to de-leveraging and tap

the equity route over debt (as was seen in FY08). However, with the nature of funds required

44%

24%

17%

8%

3% 4%

CRISIL

CARE

ICRA

India Ratings

SMERA

Brickworks

Banks have offereddiscounted rates(between 25bps- 100bps)to rated MSME

Increased FII limit in G-sec and corporatebonds

encouragingparticipation from retail

investors and domesticinstitutions

Rating of a corporatebond facilitatesacceptance and ability tooffload


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(short-term capital requirement ie bond route vs the permanent nature of capital ie equity route),the issuances will be on the better side vis--vis past periods.

Over the next 3-4 years, experts believe bond revenues will contribute ~50% of total ratingrevenues vs ~35% currently. The increased contribution will be due to the improvement insystemic bond issuance and better pricing.

Q: How is the pricing situation? Can there be improvement in overall blended yieldsgoing forward? What can be the driving factor?

A:The industry has seen huge under-cutting in both BLR and non-BLR segments. While this is likely tocontinue in the BLR segment, with the revival in bond issuances, yields on non-BLR (especiallycorporate bond issuance) could increase and contribute to improvement in overall blended yields.

BLR is a low yielding business (more of ticking the boxes) and hence the initial rating fees are

lower vis--vis bond rating (more of investor-pay model).

Franchise value plays an important role in preventing rating shopping and can drive surveillancefees (ASF). ASF on BLR is low vis--vis bond rating fees.

Gradual improvement in bond issuance will enable rating revenue mix to shift towards relativelyhigher yielding (both IRF and ASF) non-BLR segment and drive improvement in overall blended yields.

Q: MSME ratings can it be a big opportunity?

A: MSME is the backbone of large industries and according to central estimates contributed 8% toGDP, 45% to manufacturing and 40% to exports. RBI in its recent report pointed out that 30mn MSMEunit provided employment opportunities to 70mn people.

NSIC scheme has made more and more MSMEs get rated as it saves on their interest costs.According to a CRISIL report, MSME rating has made 30 banks offer discounted rate of 25bps 100bps and save on costs.

MSME rating is the next big opportunity as nearly 60% of the initially rated MSMEs have renewedtheir ratings in subsequent years.

Exhibit 2:Interest rate concession offered by banks to rated SME enterprises

Source: CRISIL report on MSME, Centrum Research

Q: What are the risks to the business - both internally and externally?

A: Internal risk: Employees are the core assets of our organisation and hence retention is veryimportant especially in the current cycle of improving job market. Attrition at mid-senior level impactsthe business and hence compensation needs to be aligned to the industry trend.

B: External risk: Rating is a highly regulated oligopolistic business that generates high margins.Credibility of the franchise is of the utmost importance. If a CRA continues to comprise on the same,regulator may take a stringent action.

4

10

7

4

3

2

0 2 4 6 8 10 12

0.25%

0.50%

0.25-0.5%

0.25-1%

0.50-1%

Others

No of banks

(Interest

rate

differential)

Bond rating ie (investor-pay model) enable garnerbetter yields over BLR(more of ticking theboxes)


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Q: Are banks prepared to adopt IRB approach? What is the potential risk of loss ofrevenue to CRAs in the event of migration to the said approach?

A:While private banks (in general) have an internal ratings approach in place, they are yet to adhere toRBI norms. PSU banks, barring the large ones, continue to struggle with other issues and will needlonger than expected time to build in the required system to meet RBI norms.

Our assessment suggests ~50% of banks will be able to migrate to IRB approach in the next 3-

years. Smaller ones will take a much longer time and hence the risk of revenue loss to credit ratingagencies in the immediate future is limited.

Extract from our report

Shift to Internal rating based approach can impact rating revenues significantly

RBI circular dated July 7, 2009 advised banks to apply for migration to an internal rating based (IRB)approach for measuring credit risk from April 1, 2012 onwards. The IRB Approach will allow banks,subject to the approval of RBI and fulfilling certain requirements, to use their own internal estimatesfor some or all of the credit risk components in determining the capital requirement for a given creditexposure.

Bank loans are currently rated by an external agency and in the event of this being evaluated by the

banks internal team it could severely impact the revenue for credit rating agencies and especiallyCARE that derives ~50% of its revenue from the BLR related market. ICRA has ~26% of its revenue fromBLR. Proportion for CRISIL is lower at ~10%.

but this is unlikely in immediate future

Interaction with industry experts and bank agencies suggest longer than expected time towardsimplementation of the said norms. Agencies suggested that the process may get delayed as a) even ifa bank comes up with its own internal rating framework, it is mandatory to get it vetted by RBI (whichitself is a lengthy process), b) smaller PSU banks are not likely to have a proper internal ratingframework in place (given the lack of technology, know-how, union related problems) and c) lack ofstandardisation and transparency.

Gist of recent Reserve Bank of India speech on: Growing NPAs in Banks: Efficacy of Ratings

Accountability & Transparency of Credit Rating Agencies

Although the road has been set for Indian banks to migrate to an internal rating based approach forevaluating their credit risk, the ability and preparedness of these banks to migrate to the internal ratingapproach is expected to be contingent on banks being in a position to test data based on the models to beused for this purpose. Banks would thus necessarily have to rely on external credit ratings for theircalculation of credit risk until all the systems are in place.

Migration to IRBapproach is a longprocess and will needsatisfactory performance


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Financials - CARE

Exhibit 3:Income Statement

Y/E March (Rs mn) FY13 FY14 FY15E FY16E FY17E

Net Sales 1,988 2,294 2,656 3,114 3,677

Growth (%) 11.6 15.4 15.8 17.3 18.1

Expenditure 649 828 1,025 1,160 1,404

Employee Cost 507 606 789 886 1,081EBITDA 1,339 1,466 1,631 1,955 2,273

Growth (%) 8.7 9.5 11.2 19.9 16.3

EBITDA margin (%) 67.4 63.9 61.4 62.8 61.8

Depreciation 26 29 32 36 39

EBIT 1,599 1,794 1,975 2,338 2,703

EBIT margin (%) 80.4 78.2 74.4 75.1 73.5

Other Income 286 357 376 419 470

Interest expenses 0 0 0 0 0

PBT 1,598 1,794 1,975 2,338 2,703

Tax 466 507 563 666 770

Effective tax rate (%) 29.1 28.3 28.5 28.5 28.5

Adjusted PAT 1,133 1,286 1,412 1,671 1,933

Growth (%) 5.4 13.5 9.8 18.3 15.6

Net Margin (%) 57.0 56.1 53.2 53.7 52.6

(Profit)/loss from JVs/Ass

Adj. PAT After JVs/Ass/MI 1,133 1,286 1,412 1,671 1,933

E/O items (1) 0 0 0 0Reported PAT 1,132 1,286 1,412 1,671 1,933

Growth (%) 5.3 13.6 9.8 18.3 15.6

Source: Company, Centrum Research Estimates

Exhibit 4:Key Ratios

Y/E March FY13 FY14 FY15E FY16E FY17E

Profitability (%)

EBITDA Margin 67.4 63.9 61.4 62.8 61.8

Net Margin 57.0 56.1 53.2 53.7 52.6ROCE 39.6 39.2 38.9 41.9 43.0

ROE 28.3 28.3 28.0 30.2 31.0Per Share Data (Rs)

EPS 39.1 44.4 48.7 57.6 66.6

CEPS40.0 45.4 49.8 58.9 68.1

BVPS 148.5 167.0 180.8 201.3 228.4DPS 19.7 28.0 30.0 32.0 34.0

Valuations (x)

PER 24.7 21.8 19.8 16.7 14.5

P/CEPS 24.1 21.3 19.4 16.4 14.2

P/BV 6.5 5.8 5.3 4.8 4.2

Dividend Yield (%) 2.0 2.9 3.1 3.3 3.5


Exhibit 5:Balance Sheet


Equity share capital 286 290 290 290 290

Reserves & surplus 3,953 4,553 4,954 5,547 6,333

Net worth 4,239 4,843 5,244 5,837 6,623

Minority Interest 0 0 0 0 0

Net deferred tax liability 39 39 43 47 54

Total Liabilities 4,278 4,882 5,287 5,884 6,677

Gross Block 615 647 676 708 744

Less: Depreciation (103) (132) (164) (200) (239)

Net block 512 515 512 508 505

Capital work in progress 0 0 0 0 0

Investment 3,901 4,677 4,973 5,462 5,999

Current Assets 758 590 1,456 1,732 2,170

Sundry debtors 293 142 458 512 604

Cash & bank balance 187 267 815 1,033 1,375

Loans & advances 127 142 144 148 152

Other current assets 151 39 39 39 39

Current liabilities & Prov 893 899 1,655 1,818 1,997Current liabilities 510 422 464 516 574

Provisions 383 477 1,191 1,302 1,423

Net current assets (134) (310) (199) (86) 173

Misc. exp 0 0 0 0 0

Total Assets 4,278 4,882 5,287 5,884 6,677


Exhibit 6:Cash Flow


Profit before tax 1,242 1,417 1,557 2,337 2,702

Depreciation 26 29 32 36 39

Interest Provided (3) (3) 0 0 0

Other Non-Cash items (267) (357) (376) (418) (469)

Change in working cap (87) 128 440 111 89Tax paid (431) (507) (563) (666) (770)

Operating Cashflow 1,325 1,594 2,071 2,065 2,362

Capital expenditure (57) (32) (29) (32) (36)

Free Cash Flow 1,268 1,562 2,042 2,034 2,326

Other income 286 357 376 419 470

Investments (1,112) (776) (296) (488) (537)

Investing Cashflow (825) (420) 80 (70) (68)

Equity Capital Raised 0 4 0 0 0

Loans Taken / (Repaid) 0 0 0 0 0

Interest Paid 0 0 0 0 0

Dividend paid (incl tax) (398) (944) (1,011) (1,079) (1,146)

Income from investments

Others

Financing Cashflow (398) (682) (1,011) (1,079) (1,146)

Net change in cash (372) (47) 547 219 342

Opening cash position 686 314 267 815 1,033

Closing cash position 314 267 815 1,033 1,375



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Financials CRISIL - (consolidated)

Exhibit 7:Income Statement

Y/E Dec (Rs mn) CY12 CY13 CY14E CY15E CY16E

Net Sales 9,777 11,107 12,733 14,862 17,618

Growth (%) 21.2 13.6 14.6 16.7 18.5

Expenditure 6,501 7,501 8,619 10,073 11,871

Employee Cost 4,432 5,212 6,029 7,072 8,337

EBITDA 3,276 3,606 4,113 4,789 5,747

Growth (%) 24.8 10.1 14.1 16.4 20.0

EBITDA margin (%) 33.5 32.5 32.3 32.2 32.6

Depreciation 343 379 451 488 528

EBIT 3,061 3,350 3,843 4,514 5,460

EBIT margin (%) 31.3 30.2 30.2 30.4 31.0

Other Income 128 124 181 213 241

Interest expenses 0 0 0 0 0

PBT 3,137 4,252 3,843 4,514 5,460

Tax 933 1,273 1,153 1,354 1,638

Effective tax rate (%) 29.7 29.9 30.0 30.0 30.0

Adjusted PAT 2,151 2,347 2,690 3,160 3,822

Growth (%) 14.6 9.2 14.6 17.5 20.9

Net Margin (%) 22.0 21.1 21.1 21.3 21.7(Profit)/loss from JVs/Ass/MI - - - - -

Adj PAT After JVs/Ass/MI 2,151 2,347 2,690 3,160 3,822

E/O items 76 902 0 0 0

Reported PAT 2,204 2,979 2,690 3,160 3,822

Growth (%) 6.8 35.2 (9.7) 17.5 20.9


Exhibit 8:Key Ratios

Y/E March CY12 CY13 CY14E CY15E CY16E

Profitability (%)

EBITDA Margin 33.5 32.5 32.3 32.2 32.6

Net Margin 22.0 21.1 21.1 21.3 21.7

ROCE 67.1 57.6 54.2 54.3 55.9

ROE 45.6 39.0 36.6 36.7 37.8RoIC 66.2 58.3 62.9 64.3 66.4

Per Share Data (Rs)

EPS 30.6 33.2 38.1 44.7 54.1

CEPS 35.2 38.2 43.9 51.2 61.2

BVPS 30.5 50.9 70.1 91.2 117.1

DPS 16.0 19.0 18.0 22.0 26.0

Valuations (x)

PER 53.9 49.6 43.3 36.9 30.5

P/CEPS 46.8 43.2 37.5 32.2 26.9

P/BV 54.1 32.4 23.5 18.1 14.1

Dividend Yield (%) 1.3 1.6 1.5 1.9 2.2


Exhibit 9:Balance Sheet

Y/E March (Rs mn) CY12 CY13 CY14E CY15E CY16E

Equity share capital 70 71 71 71 71

Reserves & surplus 5,220 6,674 7,874 9,211 10,879

Net worth 5,290 6,745 7,944 9,282 10,950

Minority Interest 0 0 0 0 0

Net deferred tax liability (175) (229) (269) (315) (371)

Total Liabilities 5,115 6,516 7,675 8,967 10,579

Gross Block 5,996 6,137 6,421 6,714 7,044

Less: Depreciation (1,328) (1,645) (2,096) (2,583) (3,112)

Net block 4,668 4,493 4,325 4,131 3,933

Capital work in progress 0 0 0 0 0

Investment 1,151 2,443 3,160 3,780 4,525

Current Assets 3,837 4,302 5,767 7,212 8,915

Sundry debtors 1,172 1,195 1,370 1,629 1,931

Cash & bank balance 1,371 1,515 2,806 3,981 5,368

Loans & advances 703 691 701 712 726

Other current assets 591 900 890 890 890

Current lia & Prov 4,541 4,721 5,577 6,156 6,794Current liabilities 3,818 3,340 3,531 3,779 4,086

Provisions 723 1,381 2,045 2,377 2,708

Net current assets (704) (420) 190 1,056 2,121

Total Assets 5,115 6,516 7,675 8,967 10,579


Exhibit 10:Cash Flow

Y/E March (Rs mn) CY12 CY13 CY14E CY15E CY16E

Profit before tax 3,060 4,146 3,663 4,302 5,219

Depreciation 343 379 451 488 528

Interest Provided 0 0 0 0 0

Other Non-Cash items (80) (839) (41) (50) (48)

Change in working cap (268) (20) 492 101 73

Tax paid (897) (1,187) (1,153) (1,354) (1,638)Operating Cash flow 2,157 2,479 3,411 3,486 4,134

Capital expenditure (397) (157) (284) (293) (330)

Free Cash Flow 1,760 2,321 3,128 3,193 3,804

Other income 77 107 181 213 241

Investments (785) (1,333) (535) (408) (504)

Investing Cash flow (708) (1,226) (355) (195) (263)

Equity Capital Raised 96 249 0 0 0

Loans Taken / (Repaid) 0 0 0 0 0

Interest Paid 0 0 0 0 0

Dividend paid (incl tax) (1,203) (1,073) (1,491) (1,823) (2,154)

Income from investments

Others 498 (83) 0 0 0

Financing Cash flow (609) (906) (1,491) (1,823) (2,154)

Net change in cash 443 189 1,282 1,175 1,387

Opening cash position 938 1,381 1,524 2,805 3,980

Closing cash position 1,381 1,524 2,806 3,981 5,368



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7Credit Rating Agencies

Appendix A

Disclaimer

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8C di R i A i

The opinions and projections expressed herein are entirely those of the author and are given as part of the normal research activity of Centrum Brokingand are given as of this date and are subject to change without notice. Any opinion estimate or projection herein constitutes a view as of the date of thisreport and there can be no assurance that future results or events will be consistent with any such opinions, estimate or projection.

This document has not been prepared by or in conjunction with or on behalf of or at the instigation of, or by arrangement with the company or any of itsdirectors or any other person. Information in this document must not be relied upon as having been authorized or approved by the company or itsdirectors or any other person. Any opinions and projections contained herein are entirely those of the authors. None of the company or its directors orany other person accepts any liability whatsoever for any loss arising from any use of this document or its contents or otherwise arising in connectiontherewith.

Centrum and its affiliates have not managed or co-managed a public offering for the subject company in the preceding twelve months. Centrum andaffiliates have not received compensation from the companies mentioned in the report during the period preceding twelve months from the date of thisreport for service in respect of public offerings, corporate finance, debt restructuring, investment banking or other advisory services in amerger/acquisition or some other sort of specific transaction.

As per the declarations given by them, Mr. Aalok Shah, research analyst and and/or any of his family members do not serve as an officer, director or anyway connected to the company/companies mentioned in this report. Further, as declared by him, he has not received any compensation from the abovecompanies in the preceding twelve months. He does not hold any shares by him or through his relatives or in case if holds the shares then will not to doany transactions in the said scrip for 30 days from the date of release such report. Our entire research professionals are our employees and are paid asalary. They do not have any other material conflict of interest of the research analyst or member of which the research analyst knows of has reason toknow at the time of publication of the research report or at the time of the public appearance.

While we would endeavour to update the information herein on a reasonable basis, Centrum, its associated companies, their directors and employees areunder no obligation to update or keep the information current. Also, there may be regulatory, compliance or other reasons that may prevent Centrumfrom doing so.

Non-rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicable

regulations and/or Centrum policies, in circumstances where Centrum is acting in an advisory capacity to this company, or any certain othercircumstances.

This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state,country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would subjectCentrum Broking Limited or its group companies to any registration or licensing requirement within such jurisdiction. Specifically, this document doesnot constitute an offer to or solicitation to any U.S. person for the purchase or sale of any financial instrument or as an official confirmation of anytransaction to any U.S. person unless otherwise stated, this message should not be construed as official confirmation of any transaction. No part of thisdocument may be distributed in Canada or used by private customers in United Kingdom.

The information contained herein is not intended for publication or distribution or circulation in any manner whatsoever and any unauthorized reading,dissemination, distribution or copying of this communication is prohibited unless otherwise expressly authorized. Please ensure that you have read RiskDisclosure Document for Capital Market and Derivatives Segments as prescribed by Securities and Exchange Board of India before investing in IndianSecurities Market.

Rating Criteria

Rating Market cap < Rs20bn Market cap > Rs20bn but < 100bn Market cap > Rs100bnBuy Upside > 25% Upside > 20% Upside > 15%

Hold Upside between -25% to +25% Upside between -20% to +20% Upside between -15% to +15%

Sell Downside > 25% Downside > 20% Downside > 15%

Member (NSE, BSE, MCX-SX), Depository Participant (CDSL) and SEBI registered Portfolio Manager

Registration Nos.

CAPITAL MARKET SEBI REGN. NO.: BSE: INB011454239, NSE: INB231454233

DERIVATIVES SEBI REGN. NO.: NSE: INF231454233 (TRADING & SELF CLEARING MEMBER)

CDSL DP ID: 12200.SEBI REGISTRATION NO.: IN-DP-CDSL-661-2012

PMS REGISTRATION NO.: INP000004383

MCX SX (Currency Derivative segment) REGN. NO.: INE261454230

Website: www.centrum.co.in

Investor Grievance Email ID: [email protected]

Compliance Officer Details:

Tel: (022) 4215 9413; Email ID: [email protected]

Centrum Broking Limited

Registered Office Address

Bombay Mutual Building ,

2nd Floor,

Dr. D. N. Road,Fort, Mumbai - 400 001

Correspondence Address

Centrum House

6th Floor, CST Road, Near Vidya Nagari Marg, Kalina,

Santacruz (E), Mumbai 400 098.

Tel: (022) 4215 9000

Credit Rating Agencies - Sector Update - Centrum 18062014.pdf

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