You have come to the right place to know about Fitch and S&P assigning a “BBB-“rating with a stable outlook for TCL or Tata Capital. Also, RBI or Reserve Bank of India, classified TCL, along with its parent company, Tata Sons, as the upper layer NBFC or non-banking financial company. One of the critical RBI guidelines for classification is to come out with the IPO. Tata Sons may consider bringing out the Tata Capital IPO to avoid coming out with its IPO because of its vast size and other reasons. The significant reason among them is that Tata Sons is the holding company of Tata Group, having 30 listed companies among many others, with over thirty lakh trillion rupees market capitalisation as of February 2024.
Continue reading this blog until the end to learn about the “BBB-“ratings given to Tata Capital by Fitch and S&P, including the reasons and benefits of investing in Tata Capital unlisted share through a reputed broker to make windfall profits.
When did Fitch and S&P assign “BBB-“ratings for Tata Capital?
Fitch started as a publishing company in 1914 and has evolved over a century to become one of the top rating agencies for financial institutions worldwide. Along with S&P or Standard & Poor’s and Moody’s, it is one of the three credit rating agencies by the US Securities and Exchange Commission. On February 21, 2024, Fitch Ratings announced TCL with “BBB-“first-time Foreign Long-Term and Local – Currency IDR or Issuer Default Ratings. Also, on the same date, it assigned TCL “BBB-“SSR or shareholder Support Rating with a stable outlook. Earlier on February 19, 2024, S&P or Standard & Poor’s, another top rating agency, assigned Tata Capital with “BBB-“long-term with a stable outlook and “A-3” short-term ratings.
Why did Fitch and S&P assign a “BBB-“rating for Tata Capital?
Tata has been a household name in India for one and a half centuries and has used many products and services since 1868. Tata Group, based in India, is spread worldwide to sell services and products in over 150 countries and operates in 100 countries. Hence, top rating agencies worldwide rank the Tata Group high, worth over 373.4 billion dollars in market capitalisation as of March 2024. Top rating agencies believe that Tata Sons has over 96% holding in TCL, and its guide and support will continue for future growth. And that is not all. There are many reasons for Fitch and S&P to assign a BBB rating to Tata Capital, including the following.
- The significant reason for Fitch and S&P giving TCL high ratings is that its credit quality is in the investment grade.
- Fitch and S&P ratings are based on the expectation that India’s largest conglomerate, with over 30 lakh trillion rupees in market capitalisation, will support TCL extraordinarily.
- Fitch confirms that it has an underpinned view of the TCL profile, which is the largest entity in Tata Group’s financial services segment. It also identifies it as a significant growth driver.
- The rating agencies consider Tata Sons’ over 96% holding in Tata Capital a significant factor because of its high value and reputation in India and worldwide.
- Fitch and S&P rate TCL with a stable outlook because of its continuing support from the promoter linkages for maintaining average asset quality and good capital position for the next two years
- The top rating agencies confirm that Tata Sons directly oversees all of TCL’s strategic decisions regarding safe and high-return capital investments.
- Fitch spokespersons confirm that Tata Sons supports the balance-sheet growth of TCL by infusing regular equity whenever it is essential.
- The rating agencies believe TCL has significant management for its daily operations, though it has direct but limited infrastructural strategies with Tata Group.
- Fitch and S&P expect TCL, with the support of Tata Sons, to grow more in the future, among other things, through its many plans to raise foreign funds.
- RBI or Reserve Bank of India categorising TCL as an upper layer NBFC paving the way for its IPO soon is another reason for the rating agencies to rank it higher
The above reasons made Fitch and S&P the two top rating agencies out of the three big credit rating agencies in the world, increasing the value of TCL so you can buy its unlisted share from the leading broker to make windfall profits.
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Frequently Asked Questions
- How will the Fitch and S&P “BBB-“rating impact the TCL unlisted share price?
Fitch and S&P’s “BBB-“rating will positively impact the TCL unlisted share price to fuel its rising price and reap high yields.
- Will Fitch and S&P downgrade TCL’s rating in the future?
With much good news like fundraising, IPO, excellent results continuously, and others, there is little chance for Fitch and S&P to downgrade TCL’s “BBB-“ratings, but if they find there is no improvement in its RAC to be above 10% in the next two years may downgrade the ratings.
When will TCL come with an IPO?
As per RBI guidelines classifying TCL as an upper-layer NBFC, experts confirm it will come out with an IPO in 2025.
- How do you buy TCL on the grey market?
Buying unlisted TCL shares in the grey market from the best broker to yield high profits is easy, simple, and safe. The top broker provides all facilities to invest in unlisted shares for the investors to keep them safe in the NSDL And CDSL depositaries to sell again whenever they want to book profits or if they need money. The top online trading platform with enough experience offers investors through substitute sources to invest with minimal entry barriers.
- What returns should you expect from buying TCL’s unlisted shares after its “BBB-“ranking by Fitch and S&P?
TCL’s unlisted share has already doubled from Rs. 400 to Rs. 800 in February, and with all the good news, it is expected to rise more as investors expect its IPO to have high returns soon.
