Moody's Insights on Indian Companies and Rupee Depreciation

In a recent analysis, Moody's has highlighted that the majority of Indian companies it rates are well-protected against the negative impacts of rupee depreciation. This resilience is attributed to several mitigating factors that these companies have in place.

Impact on Specific Sectors

However, not all sectors are equally safeguarded. Government-owned oil marketing companies (OMCs), along with Ola and UltraTech Cement, are among those facing challenges due to the rupee's slide. OMCs, in particular, experience a currency mismatch, with revenues tied to the rupee while feedstock costs are in US dollars. Despite these challenges, partial hedges through US dollar-linked fuel sales and government support help mitigate the risks.