Financial Daily from THE HINDU group of publications
Friday, Oct 18, 2002
Financial Daily from THE HINDU group of publications Friday, Oct 18, 2002 |
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Marketing
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Marketing Research Crisil develops methodology to rate film, TV producers Our Bureau
MUMBAI, Oct. 17 RATING agency Crisil has said that it has developed a methodology for grading film and television software producers. The agency carried out this exercise on behalf of the Confederation of Indian Industry (CII). Earlier, CII had produced the first authoritative `EnterMedia 2001' report, which determined the need for this project with Crisil. The new analytical framework would assist banks, institutions and other lenders in evaluating film and television software producers. "Lenders can use the framework to systematically classify risks and objectively assess the various risk issues before determining their exposure levels and interest rates for the entertainment industry. As for borrowers, so far, they have sourced funds at exorbitant interest rates from the informal market. "Now the grading framework will act as a key facilitator in accessing institutional funds," an official statement said. In the case of film producers, Crisil will assign a grade for a specific project (movie), which will indicate the agency's opinion on the producer's ability to complete a particular project and recover costs incurred. It is, therefore, possible that different movies of the same producer could get different grades. For television producers, generally constituted as corporate entities, the grade would indicate Crisil's opinion on creditworthiness of the entity. Thus, the grade would reflect the relative ability of the rated company to meet debt obligations. "While the overall analytical approach includes an assessment of business risk, financial risk and management capabilities, the methodology derives its robustness from the level of detail in incorporating entertainment industry-specific parameters and benchmarks. Crisil has held active consultations with a wide number of industry players in developing the methodology," the statement said.
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