Rating service business revenues which constitute around 28% of total revenue declined 4% yoy basis at Rs 137.08 crore, while research services revenues which forms around 65% of total revenueincreased 22% to Rs 315.81 crore. Advisory service business revenues (7% of revenues) fell 6% to Rs 32.10crore.

OPM has declined 255 bps to 23.4%, leading to flat OP at Rs 113.38 crore. The Rating service business segmental PBIDT margin dipped to 38% as compared to 43% for September 2019 quarter and PBIDT thus declined 15 to Rs 51.91 crore. Research segment PBIDT stood at Rs 35.50 crore down by 41%, with margins showing decline to 11% as compared to 23% yoy. Advisory service segment reported a segmental PBIDT of Rs 2.61 crore as compared to PBIDT of Rs 4.77 crore for September 2019quarter.

Other income declined 16% to Rs 37.02 crore for September 2020 quarter. Depreciation jumped 271% to Rs 32.65crore and interest expenses zoomed to Rs 3.63 crore. PBT stood at Rs 114.12 crore, down 23%. After providing total tax of Rs 23.89 crore, lower by 44% on yoy basis, consolidated PAT for September 2020 quarter of the company fell 14% to Rs 90.23 crore.

Financials for the quarter include the performance of Greenwich Associates LLC (GA), which was acquired in Q1 2020. Excluding this, consolidated income from operations for the quarter ended September 2020,was higher by 0.3% and profit after tax higher by 5.1% compared with the corresponding quarter of theprevious year.The results attributable to GA includes a revenue of Rs 47.92 crore and post-tax loss of Rs 20.25 crore for the quarter ended September 2020 and a revenue of Rs 104.70 crore and post-tax loss of Rs 49.81 crore for the period 26 February 2020 to 30 September 2020.

Ashu Suyash, MD&CEO, CRISIL, says "Covid-19 has altered the business dynamics of organisations globally. CRISIL's proactive and planned responses have meant all businesses remain fully functional through this prolonged pandemic. Driven by our commitment to stakeholders and markets, we have seen client wins across ratings, research and analytics. Growth during the quarter was led by continued uptick in our global risk analytics business, especially in the traded- and model-risk segments. Our ongoing focus on digital and excellence has enabled profitable growth during the period."

Other updates

While unlocking gathered pace in the third quarter, business sentiment continues to be muted because of sharp slowdown across investment and consumption oriented sectors. Capital markets issuers declined materially by 21% during the quarter, while systemic credit growth remains subdued. However, despite the weak environment, CRISIL Ratings strengthened its leading position in the corporate bond market. The Global Analytical Center (GAC) increased its coverage for S&P Global Ratings, including support for key initiatives such as environmental, social and governance evaluations, and inferencing impact of Covid-19.Overall, given the slackness, the segment de-grew 4% during the third quarter.

Growth in the Research segment was led by the Global Research & Analytics business, which saw strong demand for risk and transformation services. Fundamental research saw a tepid performance because of anticipated sell-side restructuring. India Research launched new industry reports and a district-level Covid-19 dashboard, which received good response. Coalition saw delays in client conversions given the impact of the pandemic across global financial services. The business continues to invest in new products and analytics to meet the needs of new clients. The integration of Greenwich is on track and focus is on client renewals and new mandates. The Research segment revenue grew by 22.1% during the third quarter.Excluding Greenwich, the segment growth was 3.5%.

Growth in the Advisory segment was muted given across-the-board reduction in infrastructure spends. Some risk platform implementation delays are being experienced as banks in India have deferred milestones given the impact of Covid-19. Nonetheless, the company continues to see demand forrisk assessment models and early warning signals. Overall, the segment saw 6.4% de-growth during the quarter.

The investments in technology, multi-country presence, the analytical nature of offerings as also timely and decisive steps towards remote work continue to stand the company in good stead, driving business continuity, service and product quality, and employee welfare.

The company has continued to publish impactful analysis and insights. The quarter saw 50+ press releases, 10+ opinion pieces and several whitepapers being published on topical matters. Roundtables on areas such as credit risk management and stress testing, and 18 webinars across sectors including steel, cement, pharma, telecom were hosted during the quarter. CRISIL was certified as a Great Workplace by the Great Place to Work Institute during the quarter.

Consolidated Performance–nine months ended September 2020

Consolidated income from operations increased 9% to Rs 1384.59 crore for the nine months ended September 2020, compared with Rs 1267.43 crore in the previous year. Consolidated total income was Rs 1464.12crore, compared with Rs 1330.29 crore in the previous year. Profit after tax was Rs 244.69 crore, compared with Rs 248.62 crore in the previous year.

Rating service business which constitute around 30% of total revenue was up by 3% on yoy to Rs 414.38crore, while Research services which forms around 63% of total revenue, was moved up 16% yoy to Rs 875.89 crore. Advisory service business was down by 13% to Rs 94.32crore.

OPM was down 70 bps to 24.9%, leading to 6% growth in operating profit to Rs 345.20 crore.

The Rating service business segmental PBIDT margin stood at 41% as compared to 39% for nine months ended September 2020 and PBIDT stood at Rs 168.74 crore, up by 8% yoy. Research segment PBIDT stood at Rs 137.92 crore, down by 20% on yoy basis, with margins declining to 16% from 23%. Advisory service segment reported a segmental profit at PBIDT of Rs 3.65 crore with PBIDT margin at 4%.

Other income surged 27% to Rs 79.53 crore. Interest cost shot up to Rs 10.68 crore and depreciation zoomed 226% to Rs 89.84 crore. PBT declined 10% to Rs 324.21 crore. After providing total tax of Rs 79.52 crore, down by28%, consolidated PAT for the nine months ended September 2020 of the company fell 2% to Rs 244.69 crore.

Consolidated income from operations for the nine months ended September 2020, was higher by 1.0% and profit after tax up by 18.5% compared with the previous year, excluding the financials of Greenwich.