What Rating Agencies Look for Before an Upgrade

Agencies typically look for improvement that is broad-based, sustained, and structurally explainable — not a single favourable metric.

Key Checkpoints

•      Leverage and coverage ratios sustained at improved levels across multiple periods

•      Liquidity buffers that remain comfortable, not just at the reporting date but through the year

•      A clear, credible explanation for what structurally changed to drive the improvement

•      No unresolved governance or related-party concerns from prior reviews

•      A funding and capex plan that does not threaten to reverse the improvement

Forward-Looking Confirmation

Agencies also test whether the improved profile is likely to hold under reasonably conservative forward projections, since an upgrade reflects a view on future risk, not simply a reward for past performance.

Talk to FinMen Advisors — for help preparing for a rating exercise, write to marketing@finmen.in or call +91 77387 14680.

Disclaimer: This article is intended for general informational and educational purposes only and does not constitute financial, credit, investment, or legal advice. Credit ratings are assigned solely by SEBI-registered Credit Rating Agencies (such as CRISIL, ICRA, CARE Ratings, India Ratings, Brickwork, Acuite, and Infomerics) based on their own methodologies, policies, and the information available to them at the time of assessment. FinMen Advisors provides preparatory and advisory support to companies undergoing a rating exercise and does not issue, influence, or guarantee any rating outcome. Readers should exercise independent judgement and consult qualified professionals before making business or financial decisions.