Care Ratings News: CARE Ratings’ Director and CEO, Ajay Mahajan, resigns

Ajay Mahajan, managing director and chief executive officer of CARE Ratings resigned from his post citing personal reasons, the rating company said in a release late evening Tuesday. He was appointed to run the credit rating company two years ago after its former chairman SB Mainak and predecessor MD & CEO Rajesh Mokashi had come under regulatory scrutiny for their alleged influence in rating excercise.

“We wish to inform you that the Board of Directors of the Company at their meeting held today i.e. April 26, 2022, considered and accepted the resignation of Ajay Mahajan as the MD and CEO of the company due to personal reasons,” CARE Ratings said in a late evening release. Accordingly, Mahajan will be relieved from the services from the close of business hours on May 31, 2022.

The local credit rating agency had drawn flak for its rating grades assigned to debt securities sold by select non-banking finance companies including Infrastructure Leasing and Financial Services (IL&FS) and Dewan Housing Finance (DHFL). Those all witnessed sharp downgrades of many notches, which the rating industry hardly saw before. That resulted in defaults wiping out investor money. The Securities Exchange Board of India (SEBI) had indicted key CARE officials of violating rating norms.

CARE Ratings has however seen a spate of resignations in the past two years with key officials demiting office requiring the company to recruit new executives. Sachin Gupta from CRISIL Rating joined as the new chief rating officer (CRO) among other senior appointments. “While old hands were leaving office, a new team was taking charge reflecting key changes in human resources,” said a senior executive familiar with the matter. CARE also offered better pay-packs recently, said the person.

The Board of Directors of CARE has decided to appoint Mehul Pandya, executive director – business development as interim CEO of the company with effect from June 01 this year.

“The Board places on record its deep appreciation for the contribution made by Mr. Ajay Mahajan during his tenure with the Company and wishes him the very best in his future endeavours.”