Any current/future new fundraising through debt or equity?

The company did not explicitly mention any current or immediate plans for new fundraising through debt or equity in the provided transcript. There is no direct reference to impending capital raising activities or equity issuance. The company highlighted a significant decline in volume of debt rated (~50-60% decline) impacting revenue but maintained market share. They discussed the slowdown in the economy and subdued borrowings affecting rating opportunities. No specifics were shared about future debt or equity fundraising; focus remains on monitoring economic recovery and market conditions. Su

Any current/future capex/capital investment/strategic investment?

CARE Ratings currently does not indicate any large-scale capital expenditure or capex projects directly in the provided transcript. The company is focusing on maintaining quality manpower as a key resource rather than reducing headcount, implying stable fixed employee-related expenses. Strategic investments include expanding subsidiaries in Nepal and Mauritius and a new regulatory accreditation in Kenya with plans to set up operations there within a year to 18 months. CARE is pursuing growth opportunities in risk management solutions through its CARE Risk Solutions business, targeting increase

Future growth expectations in sales/revenue/volumes?

Optimism exists for H2 FY2020, driven by festive season consumption and good Kharif harvest, potentially boosting spending and investment next year or soon after. Full recovery expected likely only by FY2021 with a swifter market pickup. Growth depends heavily on resolution pace of NBFC crisis and banking sector health. Government measures (PSB mergers, corporate tax cuts, ease of doing business, sector-specific boosts) expected to aid recovery. Corporate bond market expansion, bank credit growth (especially to industrial and service sectors), and revived capex cycle are key for long-t

Future growth expectations in earnings/operating earnings/profits/EPS?

CARE Ratings expects an improvement in H2 FY2020 over H1 due to anticipated consumption recovery from festival season and good Kharif harvest, potentially boosting investments next fiscal. (Page 4) Revenue growth is constrained by ongoing economic slowdown, banking sector stress, and NBFC crisis, impacting new issuances more than surveillance income. (Pages 3, 6, 14) Employee costs increased due to salary revisions implemented in early 2019; however, ESOP amortization charges have ended, providing some cost cushion in coming quarters. (Pages 11, 15) No significant structural or regulatory c

Current/ Expected Orderbook/ Pending Orders?

The transcripts do not specifically mention the current or expected orderbook/pending orders for CARE Ratings as of Q2 FY2020. Discussions focus on the volume of debt rated, which declined significantly by about 50-60% in the quarter. There is emphasis on the slowdown in initial ratings business due to weak market conditions, with surveillance business remaining stable. Market share in terms of rated volumes is said to be intact despite lower volumes. There is no direct information or figures provided on pending orders or orderbook status in the call.

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CARE Ratings LtdQ3 FY19Capital Markets

CARE Ratings Ltd Q3 FY19 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹1,678P/E: 31.6Market Cap: ₹5.4K CrSector: Capital Markets

Management growth scorecard

Revenue

Category 5

Margin

Category 3

Fundraise

N/A

Order

Capex

N/A

0 of 3 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 5

→Optimism exists for H2 FY2020, driven by festive season consumption and good Kharif harvest, potentially boosting spending and investment next year or soon after.
→Full recovery expected likely only by FY2021 with a swifter market pickup.
→Growth depends heavily on resolution pace of NBFC crisis and banking sector health.
→Government measures (PSB mergers, corporate tax cuts, ease of doing business, sector-specific boosts) expected to aid recovery.
→Corporate bond market expansion, bank credit growth (especially to industrial and service sectors), and revived capex cycle are key for long-term volume/revenue expansion.
→Surveillance income stable; initial rating income affected by economic slowdown and lower issuances, with efforts ongoing to boost business development.
→CARE expects better performance from subsidiaries like CARE Risk Solutions, contributing to consolidated growth.
→Overall, slow but cautious improvement anticipated, with significant dependence on macroeconomic and financial sector recovery.

Margin guidance

Category 3

→CARE Ratings expects an improvement in H2 FY2020 over H1 due to anticipated consumption recovery from festival season and good Kharif harvest, potentially boosting investments next fiscal. (Page 4)
→Revenue growth is constrained by ongoing economic slowdown, banking sector stress, and NBFC crisis, impacting new issuances more than surveillance income. (Pages 3, 6, 14)
→Employee costs increased due to salary revisions implemented in early 2019; however, ESOP amortization charges have ended, providing some cost cushion in coming quarters. (Pages 11, 15)
→No significant structural or regulatory changes anticipated to drastically alter margins; focus remains on maintaining quality manpower for quality ratings. (Page 10)
→Long-term growth depends on revival in bank credit, corporate bond market growth (including lower-rated debts), and improvement in private capex and credit flows. (Pages 9, 10)
→Overall, CARE anticipates a swifter recovery from FY2021 onwards rather than immediate rebound this fiscal. (Page 4)

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Fundraise plans

→The company did not explicitly mention any current or immediate plans for new fundraising through debt or equity in the provided transcript.
→There is no direct reference to impending capital raising activities or equity issuance.
→The company highlighted a significant decline in volume of debt rated (~50-60% decline) impacting revenue but maintained market share.
→They discussed the slowdown in the economy and subdued borrowings affecting rating opportunities.
→No specifics were shared about future debt or equity fundraising; focus remains on monitoring economic recovery and market conditions.
→Subsidiary expansions, such as entering Kenya, were mentioned, but without associated fundraising plans.
→Management emphasized maintaining quality manpower and cost control rather than raising funds at this stage.

Order book

→The transcripts do not specifically mention the current or expected orderbook/pending orders for CARE Ratings as of Q2 FY2020.
→Discussions focus on the volume of debt rated, which declined significantly by about 50-60% in the quarter.
→There is emphasis on the slowdown in initial ratings business due to weak market conditions, with surveillance business remaining stable.
→Market share in terms of rated volumes is said to be intact despite lower volumes.
→There is no direct information or figures provided on pending orders or orderbook status in the call.

Capex plans

→CARE Ratings currently does not indicate any large-scale capital expenditure or capex projects directly in the provided transcript.
→The company is focusing on maintaining quality manpower as a key resource rather than reducing headcount, implying stable fixed employee-related expenses.
→Strategic investments include expanding subsidiaries in Nepal and Mauritius and a new regulatory accreditation in Kenya with plans to set up operations there within a year to 18 months.
→CARE is pursuing growth opportunities in risk management solutions through its CARE Risk Solutions business, targeting increased performance especially outside India in South Asia and Southeast Asia.
→Regulatory-driven restructuring is causing certain businesses to be hived off to subsidiaries like CART, which carries out advisory services, reflecting strategic portfolio reorganization rather than capex-heavy moves.

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