Icra managing director, PK Choudhary spoke to The Financial Express about Icra's plans for the next millenium.

Financial Express: Will the coming months see Icra's promoters diluting their holdings to below 10 per cent, as suggested by the recent Sebi guidelines on credit rating agencies.

PK Choudhary: Currently only two institutions hold more than 10 per cent stake in Icra --State Bank of India (SBI) holds 11 per cent and Industrial Finance Corporation of India (IFCI) holds about 26 per cent stake. To date, we have not had any discussions with either of them on reduction of their stake in Icraand in any case, no company can force its shareholders to give up their holdings.

FE: What has been the impact of Sebi guidelines on the rating business, especially on the issue of corporate governance in CRAs?

PKC: Sebi guidelines will lead to some realignment in the rating business. However, these guidelines govern only the public issues of debt --a significant part of which comes from the domestic financial institutions and banks. Therefore, Icra, Care and Crisil will have to reduce promoting financial institutions' holdings to below 10 per cent in order to retain this business. Incidentally, Icra has never had any common directors or employees with its promoters.

Apart from this, while on one hand Sebi notifications require that `every CRA shall have professional rating committees for all rating decisions', on the other hand these guidelines add that the `securities issued by borrower, subsidiary or associates shall not to be rated by the CRA if there are common chairman, directors oremployees between CRAs' rating committee and these entities.' This could impact the corporate governance in rating agencies.

FE: What new products and services are being launched by Icra in the near future.

PKC: Icra is now looking at generating additional revenues through investment information services pertaining to industrial and corporate research. To start with, Icra has decided to provide off-the-shelf information on the top 500 corporates in the country. This renewed focus on research based services will also widen our client base and is now being offerred to institutional and corporate subscribers at an annual fee of Rs 75,000.

Under the economy research, Icra will offer its `Money & Finance' bulletin and its profile of sub-sovereign ratings (of state governments and their utility bodies). The reports in the industry-watch series, on the other hand, will provide subscribers with in-depth analysis on different industries, offering an insight into industry competitiveness, the imperativesfor succeeding in a global scenario and the relative positions of industry participants.

We plan to provide reports on 12-18 industries every year and have already come out with industry watch reports on the pharmaceuticals and cement sectors. The next report on auto-ancillary sector will be ready within a few weeks and each report will include half-yearly updates and occasional papers.

Apart from these, Icra's corporate reports will cover up to 500 corporates in the country, most of which have not been rated by us. Of these, exhaustive information will be provided on the top 100 corporates in terms of market capitalisation.

All these reports are designed to facilitate the investment and credit decisions of the investors/lenders. The information will be available on lines of a credit information bureau and is primarily an extension of Icra's economy, industry and corporate research activities.