New Delhi: Global rating agency Standard
& Poor’s (S&P) on Monday assigned its 'BBB' corporate credit
rating to Wipro Ltd, the country's third largest software
exporter, implying better financial health and cost
efficiency.
"We have rated Wipro higher than India's sovereign rating
(BBB-/Negative/A-3) because we believe the company would be
able to service its debt even if the sovereign defaults on its
obligation," S&P said in a statement.
The rating, which falls under investment grade, reflects
S&P's view of the company's modest financial risk profile,
superior cost efficiency, relatively weak business profile of
the company's non-IT service business, and exposure to foreign
exchange fluctuations, it said.
Wipro also has other businesses including consumer
care, lighting and infrastructure.
For the year ended March 31, 2009, the IT services
contributed about 75 percent to Wipro's total revenues of
USD five billion.
"Wipro’s IT service business has a competitive advantage
from its experience of operating global delivery models with a
majority of the workforce based in low cost countries,
especially India," said Standard & Poor's credit analyst,
managing director – Corporate & Government Ratings, South and
South East Asia, Suzanne Smith.
Bureau Report
First Published: Monday, October 26, 2009, 18:32