Global rating agency Moody's on Wednesday said the rapid decline in rupee's value against the US dollar will impact
oil companies besides raising the overseas debt servicing cost of domestic companies.
"The sharp decline in the value of the Indian rupee is generally exerting a moderate impact on rated Indian companies with the country's largest oil refining and marketing company, Indian Oil Corporation, facing the biggest challenges," Moody's Investors Service report said.
As regard to the private-sector refining companies, it said they may benefit from rupee depreciation as these firms sell the refined products via import-parity pricing.
PERSPECTIVE:
What is pulling down the rupee? "...the linking of Reliance's products sold in India to international pricing offsets the effect of its net imports," the report said.
The rupee on Wednesday touched
a fresh all-time low of 53.71/72 against the dollar , amid continuing capital outflows and further appreciation of the US currency against its major rivals, particularly euro.
The report further said that "to a moderate degree, the rupee depreciation will also affect the Tata Group's manufacturing companies with large foreign operations".
ALSO READ: Rupee fall to hit India Inc profits "The rupee's fall increase the debt servicing cost of companies with foreign currency debt, the risks for those holding large amounts of USD denominated debt as also manageable in the near term, given that debt maturities are limited for this time frame," it said.
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