Fitch Ratings has affirmed IBM India National Long-Term rating at ‘Fitch AAA(ind)’. The Outlook is Stable. A list of other rating actions is provided at the end of this commentary.
The ratings continue to draw strength from IBM India’s strong strategic linkages with its parent entity, International Business Machines (IBM, ‘A+’/Stable/’F1′). Moreover, Fitch believes that India will likely remain a key outsourcing destination for IBM based on the country’s low-cost labour and large talent pool.
While there are no legal ties (guarantees or cross default provisions) between IBM and IBM India, Fitch believes that the strategic and operational links between the two entities are strong enough for IBM to support IBM India, if required. The agency notes that IBM-IBM India relationship is of a strong parent and weak subsidiary and hence has notched