Policy on Placing Ratings on Rating Watch

During the surveillance period of the assigned rating of any entity, there may be sudden events or developments involving changes in business, management, industry or financial profile of the entity. The impact of such developments for the entity’s rating may be difficult to assess immediately and hence, the rating requires it to be put under ‘Rating Watch’.

1. Such circumstances are generally short term in nature for example -
   1. Event-Driven Uncertainty with Potential Rating Impact such as Change in Shareholding pattern of the issuing Company which can influence the overall control of the Company, its Management and the way it operates
   2. Demerger or Division Spinoff/Buyouts and Takeovers could impact on the operations of the Company, its profitability, market share etc.
   3. Change in Business Strategy of the issuing Company impacts its profitability and performance.
   4. Financial or Operational Stress Indicators Needing Confirmation
   5. Significant regulatory or legal developments, such as adverse court orders, major regulatory penalties, license suspension / restrictions etc.
2. The analyst concerned shall put up to the rating committee with the recommendation that the said entity may be placed under “Rating Watch” with positive/negative or developing implications. Intimation of placing the rating-on-Rating Watch shall be given to the issuer/concerned client and such information shall also be published in the public domain.
3. The ratings placed on “Rating Watch” shall be monitored for further confirmation of the effect of these developments from the client. Once a reasonable assessment is possible, the matter may be placed before rating committee (within a reasonable period of 6 months) for resolving the Standard Descriptors.

(Policy has been modified as per SEBI/HO/DDHS/DDHS-POD2/P/CIR/2025/101 dt 11/07/2025)