Confederation of Indian Industry (CII) in Partnership with the Ministry of MSME, Government of India organized the Global SME Business Summit 2014 on 8th October and 9th October 2014 at the India Habitat Centre, New Delhi. The theme of the summit was "Enabling Global Economic Growth through SME Partnerships". The objective of the Summit was to facilitate economic growth of SMEs through global partnerships and exploring newer markets; to work towards creating a strong platform for key decision makers, business leaders and multilateral agencies to address issues common to SMEs and identify cross-border partnership opportunities.
ONICRA Credit Rating Agency of India Limited participated in the Summit and associated events. ONICRA’s report “Performance and Credit Ratings – Giving Indian MSMEs a Cutting-Edge to Compete” was released by Mr Kalraj Mishra, Hon’ble Minister, Ministry of MSME and Mr Madhav Lal, Secretary, Ministry of MSME. The report has a great emphasis on the importance on ratings for the SME Sector and outlines the impact and benefits of the Performance and Credit Rating Scheme.
Mr Rajiv Soni, President SME, ONICRA Credit Rating Agency of India Ltd was a speaker in a special session on Financial Services for SMEs. He spoke on the importance of Ratings for the SME Sector and the role of Rating Agencies. He enumerated the benefits and impact of the ‘Performance and Credit Rating Scheme’ for the industry.
Eminent speakers from across the industry and globe addressed the Summit to share their experience and expertise. The event focused on connecting Global SMEs for mutual business development and explore emerging markets. During the event, Mr Madhav Lal, Secretary, Ministry of MSME, discussed the intent of the Government of India and the Ministry of MSME to lead Indian MSMEs on a high growth path. Mr R C Bhargava, Chairman, Maruti Suzuki India Limited in his Keynote Address, disclosed the role played by MSMEs in assisting Maruti Suzuki in its journey to become the biggest car manufacturing company. He spoke about the diversity of opportunities evolving in the auto components sector for MSMEs. Ms Patricia Hewitt, Chair, UK India Business Council, emphasized on building a healthy India UK SME partnership. Mr T T Ashok, Co-Chairman, CII National SME Council, shared about the various features of the session. He added that looking ahead, the challenge lies in building the next generation of SMEs that will collectively function as the powerhouse of the global economy.
Various Partners and Directors from SME Sector, CEOs, CMDs, MDs, EDs from Corporate & MNCs, Executives from Banks and Financial Institutions, Marketing and Finance Heads of SMEs, Business Heads of Organizations, IT and IT Enabled Service Providers, Knowledge Providing Institutions, Venture Capital and Private Equity Fund Providers, R & D Institutes and Laboratories, Representatives of Government Agencies, Government Establishments and PSUs, Service Providers and Logistic Companies, Exporters & Importers, Officials from FTZ, SEZ and Technology Parks, Credit Rating Agencies and Educational Institutions & Research Center participated in the event.
The key highlights of the Summit were :
Udyami 2014 an initiative of Samay News Network and Mydia100 Communications Pvt. Ltd was held in Patna on Thursday, 31st July 2014. Hon. Chief Minister of Bihar, Sh. Jitan Ram Manjhi presided over the event in Patna. The top dignitaries, politicians, decision makers, business leaders, opinion makers, intellectuals, experts and analysts graced the event.
Mr Manish Singh received the prestigious award on behalf of the organization in a ceremony organized at Hotel Maurya Patna on 31st July 2014. This is a very strong acknowledgement of ONICRA’s leadership in rating the largest number of MSME units in the region. A good rank from a credit-worthy rating agency enhances MSMEs’ possibilities for success. A rating agency assesses a firm's financial viability and capability to honour business risks and obligations. Rating agencies’ research evaluates the overall health of enterprises. They also benchmark MSMEs performance within the industry. The Jury awarded the rating agency which has rated maximum no. of MSME units in the year 2013-14.
Samay Udyami aims to recognize and honour achievers, innovators, and suppliers who have contributed significantly to the development of Micro, Small and Medium Enterprises in India. Awardees received recognition and were termed as the best businesses in the state for their sterling performance, leadership and enterprise. It is an effort to recognize and appreciate the contributions of an important part of India’s economic edifice which consistently adapts and innovates to stay ahead in the race to enhance productivity and profitability. Samay Udyami event attempts to focus on the opportunities and challenges that face the MSME sector through dialogue and discussion. The awardees were selected by an admirable panel of Jury Members: Dr HP Kumar, CMD, NSIC; Ashish Chauhan, MD & CEO, BSE; Sanjiv Bikhchandani, Founder and Vice Chairman, Naukri.com; Ramesh Suri, Chairman, Subros; MV Tanksale, Chief Executive, Indian Banking Association; Dr. Devi Singh, Director, Indian Institute of Management, Lucknow; Barun Das, Chief Strategic Advisor, Samay News Network; Rao Virendra Singh, Editor, Samay Uttar Pradesh / Uttarakhand Channel.
The objective of this session was to create awareness amongst the MSMEs and stakeholders
on the various steps being taken by the Ministry of MSME, GOI towards sustained
development in the MSME sector in India. There was an exemplary presence of over
250 MSME unit representatives in the event.
Sh. Madhav Lal, Secretary, Ministry of MSME delivered the keynote address
on “Steps taken by Ministry of MSME for accelerating the MSME growth in India”.
The launch of CII SME Finance Facilitation Centre (which is a one-stop-shop for
aggregating financing options from multiple large financial institutions) also took
place during the event.
Sh. Kalraj Mishra, Minister for MSMEs, Government of India launched this centre.
The Centre will conduct outreach programmes in partnership with the Ministry of
MSME and the partnering Financial Institutions (Indian Bank, Indian Overseas Bank,
Federal Bank, Muthoot Fincorp Ltd, Religare Finvest, DCB Bank, Exim Bank and State
Bank of Travancore) across the country to create awareness among SMEs on the avenues
for accessing finance. While feeling proud to see CII having a large gathering and
a number of initiatives for this important sector, the Minister emphasized the need
to have an integrated approach which will create opportunities for the common people
and create opportunities for young entrepreneurs. He mentioned that this will not
only build confidence, but also self-sustainability resulting in self-development
and nation building. While recognising the various issues related to the sector,
the Minister laid emphasis on skill development of not only the entrepreneurs, but
also of the labour section. As there are over four lakh unregistered enterprises,
how to bring them into the mainstream is what needs to be worked upon. This would
need identification of several new sectors like defence and aviation.
Mr Chandrajit Banerjee, Director General, CII mentioned that, the Indian
MSME sector is capable of growing at a healthy double digit rate, providing the
necessary impetus for our national GDP to achieve high single digit growth in the
next 2 years. He offered the support of CII to the Ministry of MSME for Accelerating
the Growth of the sector in the days to come. “we are optimistic about that the
CII online SME Finance Facilitation Centre” would go a long way in helping in leveraging
the development of MSME sector in India
The new Onicra logo stands for its vision, people and values. Onicra’s businesses
are based on research, precision and thoroughness. The new Onicra logo with the
arrowhead smartly worked into the inner sanctum of the alphabet A portrays the serious
business and practical, forward looking attitude of the Onicra.
The colors: Black implies self-control and discipline, independence and a
strong will, and hence giving an impression of authority and power. Red is a very
emotionally intense color and hence associated with energy as well as urgency. The
other color in the logo is white that signifies purity, innocence, wholeness and
completion and contains an equal balance of all the colors of the spectrum, representing
both the positive and negative aspects of all colors. Its basic feature is equality,
implying fairness and impartiality, neutrality and independence. The colors amalgamate
impeccably and reflect Onicra’s strong-willed businesses and its vision.
Our logo is a reflection of a secure and efficient system, symbolic of us being
connoisseurs in our jobs and our people who are our greatest strength.
Symbolism: To see an arrow in motion represents swiftness and movement towards
a goal. The direction the arrow is going indicates where that movement is taking
place. The elemental direction comes into play here which in this case is upwards.
A straight arrow represents focus and goodness. The arrow signifies growth, precision
and development; these are precisely the qualities that the company stands for.
Onicra participated in a town hall meeting in Jodhpur to enhance awareness on benefits
of the Performance and Credit Rating Scheme. The seminar conducted at MIA House,
Jodhpur had about 250 participants from different units from the region along with
bankers and officials from various institutions.
Udyami 2013 (Varsh ke Sarvshrestha Udyami) an initiative of Samay
News Network and Mydia100 Communications Pvt. Ltd was held in Lucknow, Uttar Pradesh
on Sunday 23rd February 2014. Hon. Chief Minister Shri Akhilesh Yadav
presided over the event in Lucknow. The top dignitaries, politicians, decision makers,
business leaders, opinion makers, intellectuals, experts and analysts graced the
Mr Sanjeev Pathak, Vice President SME Rating received the prestigious award on behalf
of the organization in a dazzling ceremony organized at Hotel Taj on 23rd February
2014. This is a very strong acknowledgement of ONICRA’s leadership in rating the
largest number of MSME units in the region in the year 2013.
A good rank from a credit-worthy rating agency enhances MSMEs’ possibilities for
success. A rating agency assesses a firm's financial viability and capability to
honour business risks and obligations. Rating agencies’ research evaluates the overall
health of enterprises. They also benchmark MSMEs performance within the industry.
The Jury awarded the rating agency which has rated maximum no. of MSME units in
the year 2013.
Samay Udyami aims to recognize and honour achievers, innovators,
and suppliers who have contributed significantly to the development of Micro, Small
and Medium Enterprises in India. Awardees received recognition and were termed as
the best businesses in the state for their sterling performance, leadership and
enterprise. It is an effort to recognize and appreciate the contributions of an
important part of India’s economic edifice which consistently adapts and innovates
to stay ahead in the race to enhance productivity and profitability. Samay Udyami
2013 event attempts to focus on the opportunities and challenges that face the MSME
sector through dialogue and discussion.
The awardees were selected by an admirable panel of Jury Members: Dr HP Kumar, CMD,
NSIC; Ashish Chauhan, MD & CEO, BSE; Sanjiv Bikhchandani, Founder and Vice Chairman,
Naukri.com; Ramesh Suri, Chairman, Subros; MV Tanksale, Chief Executive, Indian
Banking Association; Dr. Devi Singh, Director, Indian Institute of Management, Lucknow;
Barun Das, Chief Strategic Advisor, Samay News Network; Rao Virendra Singh, Editor,
Samay Uttar Pradesh / Uttarakhand Channel.
Onicra Conducted a seminar in Jalandhar to enhance awareness on benefits of the
Performance and Credit Rating Scheme. The seminar conducted at Maya Hotel, Jalandhar
had about 40 participants from different units from the region.
Onicra bags vendor rating assignment for a company which is amongst the top-ten
global steel producing companies
Onicra undertakes Techno-Economic Viability study for its client for their upcoming
housing project in Chandigarh
J& K Bank, the premier financial institution of the state renewed its Memorandum
of Understanding (MoU) with ONICRA Credit Rating Agency of India Ltd for rating
of Micro, Small and Medium Enterprises (MSMEs). The MoU was signed by Mr. Shafat
Ahmad Banday, President on behalf of J&K Bank and Mr. Vikas Jain, Senior Manager-Banking
Relationships & Alternate Channel on behalf of ONICRA at the bank's HQ in Srinagar.
Mr Shamim Ahmad of J&K Bank was also present on the occasion.
Onicra Conducted a seminar with Uttar Pradesh Ramgarhia Welfare Association, Lucknow
to enhance awareness and benefits of the Performance and Credit Rating Scheme. The
seminar had about 80 participants from different SME Units from the Association.
Onicra conducted a seminar with the SSI Association, Kota on 5th and 6th November
2013 to enhance awareness & benefits of the Performance and Credit Rating Scheme
The wholly owned Indian subsidiary of the world's largest motorcycle manufacturer
partners with Onicra for assessment of its logistics vendors.
Onicra undertakes Solar Grading assignment for a leading supplier & manufacturer
of safety equipment and energy conservation products in Satara, Maharashtra.
Onicra Conducted a seminar with Bicycle Parts Association, Ludhiana to enhance awareness
and benefits of the Performance and Credit Rating Scheme. The Bicycles Parts Association
has around 40 units in the Association.
A British motorcycle manufacturer which is preparing to enter the Indian market
with their high-end motorcycles, partners with Onicra to undertake new dealer evaluations
Onicra undertakes Techno-Economic Viability study for its client for their upcoming
city mall in Nainital.
Onicra undertakes Techno-Economic Viability study for its client for their upcoming
medical college & hospital in Moradabad.
The Small Industries Development Bank of India (SIDBI) today entered into a pact
with Onicra Credit Rating Agency to facilitate timely flow of credit to small businesses.
The two bodies signed an agreement to provide loan syndication services for facilitating
flow of timely and adequate credit to the micro, small and medium enterprises, a
statement by SIDBI said.
This is the seventh rating agency that SIDBI has tied up with for serving its mandated
sector of MSMEs, it added.
Onicra provides ratings, risk assessment and analytical solutions to individuals,
MSMEs and corporates, it said, adding that a credit rating helps creating the required
trust for a financial market player.
Onicra Credit Rating Agency of India Ltd. has been empanelled by Ministry of New
and Renewable Energy (MNRE) to grade the companies for off grid and decentralized
solar application program.
The gradings allow participation of only credible channel partners for project implementation
and help to set benchmarks and promote usage of best practices in the industry.
Lucknow (PNS): The Indian Industries Association and Oncira Credit Rating Agency
of India Ltd signed an MOU on Wednesday at IIA head office in Lucknow so that better
credit rating service could be provided to micro small and medium enterprises.
General secretary, IIA, Manish Goel and Vice-president, Banking Relationships and
Alternate Channel, Onicra, Sameer Suri inked the MOU. Chairman, Greater Noida Chapter,
IIA, AD Pandey, Chairperson, Noida Chapter IIA, Manjula Mishra and past presidents,
IIA, GC Chaturvedi and Anil Gupta were also present during the MOU signing ceremony.
The IIA discussed the benefits and significance of credit rating for MSMEs with
AFC launches Grading Services for Agricultural Produce Marketing Committees in various
states in collaboration with Onicra Credit Rating Agency of India Ltd., which belongs
to the Onida Group. Onicra provides a variety of rating and business process services
to individuals, corporates such as MSME Rating, Business Associate Rating, Education
Rating, Vendor Rating, Employee Background Assessment and Profiling.
APMCs provide a host of services to farmer members to enable them to obtain the
best price for their produce. Developments are taking place to modernize their functioning.
APMCs are set to become hi-tech by providing online information of arrivals of produce,
auctions and sales to enable better price realization by farmers. Grading of APMCs
would be useful in comparing the services of various APMCs and enable them to bring
about improvement in the facilities and services provided by them.
A desire to obtain a credit rating is often motivated by its need for getting Bank
finance at a subsidized rate / issuing debt-related instruments in capital market.
However, information asymmetry problem is one of the major obstacles to the unit’s
endeavor. To reduce the information asymmetry problem, the unit has to seek a credit
rating from an independent credit rating agency.
The process to obtain a credit rating on a particular issue usually starts with
a request from the unit who has expressed an interest in securing a rating. Then
happens with a series of meetings between the unit’s management and the rating agency
ensues. Analysts and corporate financial team then exchange queries, views and information
relevant to the credit rating.
Credit Rating criteria often encompass a set of both qualitative and quantitative
indicators. The qualitative indicator includes an SME unit’s growth potential, its
capital requirements, the degree of competition in the market, ownership structure
and quality of corporate governance.
Quantitative indicators measures whether an SME unit has overly extended itself
- by measure of debt leverage, the unit’s profitability and efficiency returns on
equity, on assets or on its capital.
The rating process is not limited to an examination of various financial measures.
Proper assessment of credit quality for an industrial SME unit includes a thorough
review of business fundamentals; including industry prospects for growth and vulnerability
to technological change or regulatory actions.
NEW TRENDS: CORPORATE GOVERNANCE SCORING A set of core principles
of corporate governance are relevant across a range of jurisdictions. These can
be used as cornerstones in a corporate governance scoring methodology for SME units.
CORPORATE GOVERNANCE SCORE (CGS)
The corporate governance score expresses Credit Rating Agency’s current opinion
about the extent to which a unit adopts and abides to the guidelines of good corporate
governance practices that clearly serve the interest of its financial stakeholders
(includes both company’s governance and creditors).
For purposes of the CGS, corporate governance encompasses the interactions between
a unit’s management, its board of directors, share holders and other financial stakeholders.
This reflects that the quality of a unit’s governance process can affect its ability
to honor financial obligations to creditors and to maximize the value of a unit’s
equity for its shareholders.
CGS and CREDIT RATINGS
A credit rating is generally an opinion of the financial ability of an entity to
meet its debt obligations in accordance with their terms but, the scope of CGS is
to benchmark the recent and current standards of corporate governance, rather than
opine on specific financial / commercial performance.
While corporate governance can affect a unit’s creditworthiness and equity attractiveness,
the score does not itself express an opinion about the share valuation.
NEW TRENDS: Parent/Subsidiary Rating Links; Subsidiaries
Affiliation between a stronger and a weaker SME unit will almost always affect the
credit quality of both, unless the relative size of one is insignificant. The question
is rather how close together the two ratings can be pulled on the basis of affiliation.
General Principles: In general, economic incentive is the most important factor
on which to base judgments about the degree of linkage that exists between a unit
owner and subsidiary. Business managers have a primary obligation to serve the interest
of their shareholders.
A weak subsidiary owned by a strong unit owner will usually, although not always,
enjoys a stronger rating than it would on a standalone basis. Assuming that the
unit owner has the ability to support the subsidiary during a period of financial
stress, the spectrum of possibilities still ranges from ratings equalization at
one extreme to very little or no help from the owner’s credit quality at the other.
The unit’s rating is, of course, assigned when the owner guarantees the subsidiary
debt. Guarantees and assumptions of debt are different legal mechanisms that are
equivalent from a rating perspective.
Determining Factors: No single factor determines the analytical view of the relationship
with the SME unit in question. Rather, there are few factors that, taken together,
will lead to one characterization or another. - SME World