Crisil Ltd
On the face of it, it might seem as though CRISL has delivered a superlative performance for Q3 ended 30th Sept 2013 ( Follows Calendar Year (CY) ending). It ended the quarter with a 96% (YoY) jump in consolidated net profit at Rs.117 crore though net income rose just 5%. But this is thanks to the exceptional income of Rs.66 crore and this was on account of sale of 637,000 equity shares of India Index Services & Products Limited (IISL) representing 49% of holding in IISL. The Company has fully divested its stake in IISL for Rs.100 crore. Forex gain of Rs.12.34 crore also helped. If we were to exclude exceptional gains, rise in net profit was 23%, which is not bad but much lower than a 96% rise! In terms of segment break-up, rating service which contributed 36% to the total income remained flat for the quarter, advisory services, which forms a miniscule part of its income, fell 7% and the main bread winner is actually research services, which contributed 59% to the total income and was up 10%.
The quarter saw extreme volatility in the Indian financial markets, coupled with high interest rates and a decline in economic growth. It resulted in a virtual halt to any type of issuance, whether equity or bonds. This affected CRISIL"Ÿs bond ratings and India research businesses, leading to muted revenue growth. Ratings revenues were driven by the Bank Loan Ratings and SME Ratings businesses. The Global Analytical Centre (GAC) business of CRISIL continues to see good demand from the analytical team of S&P Ratings, driven by a pick-up in business volumes across the global corporate and structured finance domains. The company, which follows the Jan-Dec year, for the 9-month ended 30th Sept 2013, posted a consolidated net profit at Rs.227 crore v/s Rs.220 crore for CY2012. Clearly, this year is sure to end on a much higher note, exceptional income or not!