Fitch: South Africa companies stable

Fitch Ratings said in a new report that corporate ratings in South Africa are expected to remain largely stable in 2011, supported by issuers' moderate leverage profiles and sound liquidity at the end of 2010.

This follows an anemic economic recovery in South Africa from early 2010, which should gather steam into 2011, improving issuers' medium-term financial flexibility, the agency said.

While corporate issuers may continue to be adversely affected by weak domestic and international demand conditions and input cost increases being higher than inflation, Fitch said that these factors have been largely factored into existing ratings

The agency said it believes that market conditions will be less challenging than those faced in 2010.

Constraints in 2011 include the possibility of weaker-than-expected consumer demand, driven by anemic growth in international markets, Fitch added.

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