The ratings on France-based IT consulting and service group Cap Gemini S.A. reflect Standard&Poor's Ratings Services' view of the group's business risk profile as "satisfactory" and financial risk profile as "intermediate," as our criteria define the terms. The ratings are underpinned by the group's broad and diversified capabilities in IT services, solid and growing offshore base, and adequate cost control. Rating strengths also include Cap Gemini's sound balance sheet and strong liquidity position. The ratings are constrained by the cyclical and intensely competitive nature of the IT services industry, which results in price pressure, low margins, frequent capacity adjustment costs, and large intrayear working capital needs. Fiscal tightening measures in Europe and the U.S. could hurt business sentiment,
