Strategic Priorities and Performance

ICRA outlined five strategic priorities: Ratings & ancillary services, Risk & Analytics (R&A), Human Resources, Digital Transformation, and Inorganic Growth.

Ratings Business Performance:

  • Revenue grew at 12.4% CAGR from ₹187.2 crore in FY2021 to ₹336.5 crore in FY2026
  • Ratings margin expanded significantly from 20.8% in FY2021 to 37.6% in FY2026

Risk & Analytics Business Performance:

  • Revenue grew approximately 2.7x at 22.2% CAGR from ₹114.9 crore in FY2021 to ₹313.2 crore* in FY2026
  • Anchor client revenue share reduced to 49%* in FY2026 from 80% in FY2021
  • FY2026 revenue shown on pro forma basis including Fintellix revenue for full year
  • People strength increased from ~1,120 in FY2021 to ~1,700 in FY2026

Group Performance:

  • Group revenue grew at 16.5% CAGR from FY2021 (₹301.1 crore) to FY2026 (₹646.9* crore)

Q2 & H1 FY2027 Financial Performance

Overall Performance:

  • ICRA delivered strong revenue growth in H1 FY2027
  • Growth led by broad-based growth in Ratings business
  • PAT growth supported by strong Ratings performance
  • R&A segment impacted by acquisition-related depreciation and amortization

Risk & Analytics Segment:

  • R&A growth led by acquisition of Fintellix
  • Steady demand for risk and regulatory solutions
  • Favorable currency movement contributed to growth
  • Underlying R&A operating performance remained healthy
  • R&A EBITDA increased by 35% YoY to ₹47.1 crore in H1 FY2027
  • Operational integration completed with R&A now operating as unified platform

Business Environment Analysis:

Bond Market:

  • H1 FY2027: 3.7% YoY growth [PY 30.5%]
  • Bond issuances started tepid in Q1 FY2027 but rose sharply in Q2 FY2027
  • Driven by large-ticket transactions and quarter-end activity
  • Commercial paper outstanding grew 27% YoY as of September 30, 2026

Bank Credit:

  • As of September 30, 2026: 21.4% YoY growth [PY 10.4%]
  • Supported by shift in demand from bond market amid higher yields
  • Steady demand from corporate and retail segments
  • Deposit rates witnessed gradual easing with transmission largely completed

Securitization:

  • Market volumes estimated to have grown by ~42% in H1 FY2027 YoY
  • Strong growth by NBFCs and HFCs
  • Gold loans continued to lead growth with ~1.5 times YoY increase
  • Traditional segments (vehicle loans, MSME/business loans, mortgage loans) maintained steady growth

Ratings Performance Metrics

  • Ratings performance metrics remained strong
  • Excludes one default due to operational reasons recognized in February 2025 in accordance with SEBI regulations

Macroeconomic Outlook

Baseline Projections:

  • Sub-par and uneven rainfall during Southwest Monsoon season 2026 weighed on kharif acreage
  • Expected to dampen crop yields and output
  • Shortfall in reservoir storage levels likely to impact rabi crops sowing and output
  • Weak monsoon may dampen rural demand in H2 FY2027
  • Upside risks to food inflation outlook for H2 FY2027

Growth Factors:

  • Tailwinds from previous fiscal (income tax cuts, GST rationalization, low inflation, monetary easing, healthy crop output) have dissipated
  • Rising inflation expected to weigh on urban consumption
  • Strong base of GST rationalization to optically dampen volume growth in H2 FY2027
  • Elevated input prices to impact growth in value-added of businesses
  • Monetary tightening to weigh on household consumption

Government Capex:

  • Government's capex growth of 14.3% budgeted for FY2027 augurs well for investment activity
  • Fiscal slippage risks could manifest into discretionary spending cuts

External Sector:

  • Merchandise exports expected to grow by double digits in FY2027
  • Benefitting from elevated commodity price inflation
  • Downside risks from geopolitical tensions in West Asia
  • Services exports outlook remains cautious due to geopolitical uncertainty

Operational Developments

Risk & Analytics Integration:

  • Completed integration of people, processes, go-to-market and products
  • R&A now operating as unified platform offering integrated risk, data and regulatory solutions
  • Traditional strength in credit risk domain augmented with operational integration of D2K and Fintellix
  • Creating stronger cross-selling opportunities

Digital Transformation:

  • Integration across enterprise tools
  • Development of in-house platforms with AI integration for workflow optimization