What is the importance of the term "Interest Coverage Ratio" of a firm in India ? 1. It helps in understanding the present risk of a firm that a bank is going to give loan to. 2. It helps in evaluating the emerging risk of a firm that a bank is going to give loan to. 3. The higher a borrowing firm's level of Interest Coverage Ratio, the worse is its ability to service its debt. Select the correct answer using the code given below :
a
1 and 2 only
b
2 only
c
1 and 3 only
d
1, 2 and 3
Corporate Finance / BankingFinancial Ratios and Risk Assessment for LendingInterest Coverage Ratiofirm riskbank lendingdebt servicing abilitypresent riskemerging risk