Financial determinants of corporate credit ratings: An Indian evidence
本研究利用面板数据和截面数据，通过有序Probit模型分析印度公司信用评级的长期和短期财务决定因素，发现公司规模、盈利能力和杠杆率对评级有显著影响，并构建了两个预测模型。
Abstract Credit rating is a vital tool in the hands of investors and other users. Standard mathematical formulas do not exist for determining credit ratings. Instead, rating agencies exercise their judgment and use their experience to determine what information is to be important in providing a rating. Thus, knowledge and understanding about factors influencing credit ratings is very crucial for companies being rated and other users. Most of the prior studies in related context have used developed countries' data, and the effect in emerging markets, especially in Indian context, is still unclear due to lack of such studies. So, this study attempts to identify the long‐term and short‐term financial determinants of credit ratings issued to Indian companies and examines their impact on credit ratings on the basis of panel data and cross‐sectional approaches. Ordered probit analysis is used with credit ratings as the dependent variable and six financial factors as the independent variables. Results indicate that size, profitability and leverage have a significant relationship with corporate credit ratings in both panel data and cross‐sectional approaches. Also, size has the highest impact on credit ratings followed by leverage and profitability in both the approaches. The major contribution of present study is that two different mathematical models are framed which have a reasonably well correct prediction percentage. These models can be used by the investors' academicians, practitioners and other users for predicting the rating categories of various companies and to get a fair idea about their creditworthiness and safety.