Active Investing Explained with Credit Rating Agencies (Q1 FY26)

💡 Why Active Investing Matters Investing in the stock market is easy — but investing in the right businesses is what really matters. Active investing means allocating your money into companies that are actually growing fast. In this article, we explain active investing using the latest Q1 FY26 results of India’s listed credit rating agencies. 🔍 Right Allocation vs Wrong Allocation Right allocation: Where the company is showing real business growth. Wrong allocation: Where there’s no growth, no scalability, and no visibility. 🚀 Why Active Investors Win in Bull & Bear Markets In a bull market, the fastest-growing companies rise the most. In a bear market, strong businesses fall the least. That’s why active investors benefit in both market conditions, while passive holders often underperform. 🏁 Case Study: Credit Rating Agency Sector India has 3 major listed credit rating companies: CRISIL CARE Ratings ICRA 📈 What’s Their Business Model? These companies assign credit ratings to businesses raising funds from capital markets. Their ratings are based on parameters like: Cash flows Debt levels Balance sheet quality Return on equity These ratings help investors and lenders judge the financial strength of those businesses. 📊 Q1 FY26 Growth Comparison Company Name YoY Revenue Growth (Q1 FY26) CRISIL 5% ICRA 7% CARE Ratings 20% 👉 CARE Ratings has shown the strongest growth this quarter — indicating strong business momentum. 🏎️ Speed Matters: Think of it Like a Race If your portfolio company is growing slower than India's nominal GDP growth (~11–12%), then it is falling behind in the race. In Q1 FY26, CARE Ratings has outrun CRISIL and ICRA in growth terms. → This shows why an active investor should always bet on the "Fastest Car in the Race". 🧠 What Active Investing Really Means Tracking every quarter’s earnings Comparing with peer group Making active portfolio changes Just holding onto stocks without review doesn’t generate outsized returns. 📅 How to Re-Evaluate Your Portfolio Increase allocation to companies with rising growth momentum Exit companies showing weak performance or poor guidance Don’t fear adding new stocks — if they’re winning the growth race Disclaimer: This is not a stock recommendation. It’s for educational purposes to help you take informed decisions.