Fitch revises Alibaba, Tencent views

Fitch Ratings said it revised the outlook on Alibaba Group Holding Ltd. and Tencent Holdings Ltd. to negative from stable and assigned A+ long-term local-currency issuer default ratings to the companies. The agency also affirmed their foreign-currency ratings at A+.

The outlook revision follows a similar action on China’s sovereign rating and outlook on April 9, the agency said.

“The negative outlook on Alibaba's and Tencent's LC IDRs reflects our view that the underlying credit quality of these companies should not exceed that of the sovereign due to their predominantly domestic businesses and the level of government regulation, oversight and intervention in their sector,” Fitch said in a press release.

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