Rupee at 80 to the dollar: Forex deficit to hurt India Inc's margins

As the rupee touches the 80-mark against the dollar, this depreciation is likely to prove expensive for corporate India

The rupee breached the 80-mark against the dollar on Tuesday. The steady depreciation in the value of the rupee against the US dollar is likely to prove expensive for corporate India. The listed companies’ revenue expenses in foreign currency or imports exceed their export revenues or revenue earnings in forex. 

In their latest financial year, BSE500 companies, excluding banks and non-banking finance companies and insurance (BFSI), reported combined forex expenses of Rs 12.31 trillion against forex earnings of around Rs 10 trillion. Given this, rupee depreciation will result in a faster rise in expenses hurting corporate margins and profitability in