InvestorQ : What is the rating of an NCD?
Anushri Vasa made post

What is the rating of an NCD?

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Sam Eswaran answered.
1 year ago

Non-convertible debenture (NCD) are provided credit ratings by credit rating agencies. It is these ratings that help an individual decide whether to park their funds in the NCD or not.

Every company that plans to raise money will seek a rating by credit rating agencies because they know that this will impact investor decision.

A poor rating means that the rating company doesn’t believe the company issuing NCDs will service its obligations (to investors) on time. A high rating, in contrast, means the rating agency is fairly confident of the NCD-issuing company of fulfilling its debts in time.

A few credit rating companies of India are:

- Fitch Ratings