A credit rating is an assessment of the creditworthiness of a borrower or issuer with respect to a particular debt or financial obligation. A higher rating typically implies a higher degree of safety on the investment.

Instruments with rating from AAA to BBB- are classified as Investment Grade, while below BBB- are called Junk. Instruments below BBB- category have significant risk and investors should be careful before investing in such instruments.

Below is an example of the rating scale of ICRA.

AAA
Instruments with this rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.
AA
Instruments with this rating are considered to have a high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk.
A
Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.
BBB
Instruments with this rating are considered to have a moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk.
BB
Instruments with this rating are considered to have a moderate risk of default regarding timely servicing of financial obligations.
B
Instruments with this rating are considered to have high risk of default regarding timely servicing of financial obligations.
C
Instruments with this rating are considered to have very high risk of default regarding timely servicing of financial obligations.
D
Instruments with this rating are in default or expected to be in default soon.