In addition, rating has been withdrawn for its short-term debt programme. Giving the rationale, ICRA said the rating downgrade is on account of lack of adequate information regarding the performance of Karvy Stock Broking and hence the uncertainty around its credit risk profile.
"As part of its process and in accordance with its rating agreement with Karvy Stock Broking Limited, ICRA has been trying to seek information from the entity so as to monitor its performance. But despite repeated requests by ICRA, the entity's management has remained non-cooperative," the ratings agency said in a statement.
In the absence of requisite information, and in line with SEBI's circular, ICRA's rating committee has given a rating view based on the best available information.
The rating for short-term debt programme of Rs 125 crore is withdrawn at the request of the rated entity in accordance with ICRA's policy on withdrawal and suspension, the ratings agency added.
A ratings agency moving a corporate entity to the non-cooperating category is a rare occurrence. It indicates a breakdown in communication and lack of information provided to the agency.
ICRA said the rating is based on limited or no updated information on the entity's performance since the time it was last rated in March 2019.
"The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating does not adequately reflect the credit risk profile of the entity," ICRA said.
"The entity's credit profile may have changed since the time it was last reviewed by ICRA; however, in the absence of requisite information, ICRA is unable to take a definitive rating action," the agency statement said.
( With inputs from IANS )