TCS, Infosys maintain S&P rating
September 26th, 2008
BANGALORE: Standard & Poor’s Ratings Services said today that there is no immediate impact on its ratings on India’s Infosys Technologies Ltd and Tata Consultancy Services Ltd following the recent financial market turmoil.
However, the current environment increases the challenges in raising the rating, given that financial services represent the largest industry segment for both information technology (IT) services providers; their operating margins may weaken as a result.
Nevertheless, both companies continue to register strong growth in non-financial sectors such as manufacturing, utilities, and healthcare. The current financial market turmoil could also eventually result in increased outsourcing to reduce cost and manage integration, thereby benefiting India’s leading IT services providers.
The ratings on Infosys and TCS continue to be supported by their conservative financial profiles, consistent profitable track record, and debt-free or minimal debt position. Standard & Poor’s will review the ratings after fiscal 2009 results are announced, with any potential adverse rating action likely to be limited to the outlook being revised to stable from positive.
Source:Times of India
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