Weak rupee a worry for Indian firms as 44% foreign loans unhedged

Experts say the rupee is expected to depreciate further during the year as there is huge maturity of forex loans coming up

As the Indian currency hovers around its lowest versus the US greenback, several smaller and mid-sized companies are expected to face rough weather as almost 44 per cent of the foreign loans taken by Indian companies remained unhedged.

According to the data sourced from the Reserve Bank of India, Indian companies raised around $38.2 billion in the financial year ended in March. Of this, only 56 per cent of the loans are hedged while the rest of the foreign loans remain unhedged, thus risking the companies to forex volatility. Some of the unhedged loans may have natural cover in