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A study on economic factors affecting credit ratings of Indian companies
, Mehul Mehta, Abhijay Shukla, Piyush Agarwal
Published in LLC CPC Business Perspectives
Volume: 16
Issue: 2
Pages: 326 - 335
The objective of the research carried out is to understand the impact of selected economic variables (such as Crude Oil Price, GDP, Industrial Production, Exchange Rates, and Inflation) on credit rating of Indian companies.The sample comprises of 120 rating observations during the period 2012–2016 for a total of 24 companies of India.Measurement of central tendency – descriptive statistics is used where credit rating is used as dependent variable and five economic factors viz. Crude Oil Price, GDP, Industrial Production, Exchange Rates, and Inflation as the independent variables. Results from the analysis indicate that the credit rating responds in both linear, as well as nonlinear manner, to selected economic factors. Economic factors such as GDP, Industrial Production, and Exchange Rates have a linear relationship to credit rating, whereas Crude Oil price and Inflation have a non-linear impact upon the credit rating.
About the journal
JournalInvestment Management and Financial Innovations
PublisherLLC CPC Business Perspectives
Open Access0