DHFL case: Care says it has not issued ratings

Care Ratings, on Wednesday, said its subsidiary, CARE Advisory Research and Training Limited (CART), had undertaken an advisory proposal for Oaktree Capital.

“..the question of CART issuing any kind of ratings or indicative rating on the proposal does not arise because CART does not hold any regulatory licence to undertake ratings business,” it further said in a regulatory filing, adding that Care Ratings, the ratings company, was in no way involved in the matter.

Its statement comes in the backdrop of the resolution process of Dewan Housing Finance Corporation Ltd (DHFL), where the two top bidders are Oaktree Capital and Piramal Capital and Housing Finance Ltd.

Market regulator SEBI has received a complaint against unnamed credit rating agencies offering views to Oaktree Capital on a future rating of DHFL resolution plan and instruments.

SEBI had also written to the DHFL Administrator for more details on how Oaktree Capital could make such claims.

Elaborating on the advisory proposal by CART to Oaktree Capital, Care Ratings further said that it was a research-oriented advisory proposal, purely based on publicly available data and no rating or grading exercise was carried out.

“We would also like to categorically state that Care Ratings Limited has not issued any rating or any kind of indicative ratings under the said proposal,” the agency said.

It also said that it is in regular touch with the SEBI on this matter and has furnished all the details to them.

Under SEBI regulations, credit rating agencies can not offer an indicative rating of an instrument, as it has the potential to mislead investors.

COMMENT NOW