Mumbai, Dec. 13: Standard & Poor’s (S&P) today revised upwards the long-term corporate credit rating of tech companies Tata Consultancy Services, Infosys and Wipro to “A” from “BBB+”.
However, it retained the negative outlook on their foreign currency rating.
S&P raised the local currency rating of the three companies to “stable” and removed them from credit watch, where they had been placed with positive implications on November 26.
“We upgrade the long-term corporate credit ratings of TCS, Infosys and Wipro because we believe these companies have the business and financial flexibility to withstand a significant period of sovereign stress and still have enough liquidity to honour all its obligations in a timely manner,” S&P credit analyst Abhishek Dangra said.
According to the rating agency, both Infosys and Wipro have "satisfactory" business risk profiles to reflect their good service-delivery capability, cost-competitive workforce, and high repeat business of more than 95 per cent.
“We believe the Indian IT companies’ exposure to increasing protectionist policies, particularly in the key market of the US, tempers the strengths. Such policies could result in higher costs because of on-site hiring, an increase in rejection rates, and delays in visa approvals and extensions for the company’s largely India-based employees,” it added.