World's third-largest grocery retailer, with an unrivaled leading market position in the U.K. grocery retail market. Superior operating performance and track record in the U.K. due to its scale and a strategy based on business growth through sales rather than margins. Well-diversified store portfolio with a large percentage of freehold properties. Successful diversification into selected Asian and Central European markets and nonfood product categories. Credit metrics constrained owing to debt-financed investment and increased operating lease commitments. Discretionary cash flow generation constrained due to high discretionary capital expenditures. Banking risks within its U.K. banking business. The ratings on U.K.-based Tesco PLC reflect Standard&Poor's Ratings Services' view of the group's excellent business risk profile. This is supported by Tesco's position
