TCS, Infosys set to gain from sliding rupee; Bharti Airtel, Ola's parent brace for challenges: Moody's
Tata Consultancy Services (TCS) and Infosys stand poised to benefit from the weakening rupee, while Bharti Airtel and ANI Technologies, Ola's parent firm, face challenges as their dollar-denominated debts rise in cost. A Moody’s report highlighted the divergent fortunes of Indian corporates amid the rupee’s sustained decline.
As the rupee continues its downward slide, losing over 20% against the U.S. dollar since 2020, TCS and Infosys, both rated “Baa1 stable" by the ratings agency Moody’s, are well-positioned to capitalize on the currency depreciation. Their revenues are largely denominated in dollars, while costs are incurred in multiple currencies, including the rupee, giving them a natural advantage as the rupee weakens, Moody’s said.
On the flip side, Bharti Airtel and ANI Technologies face headwinds from elevated financing costs linked to their foreign-currency debt. Bharti Airtel, with nearly half of its borrowings in U.S. dollars, faces heightened refinancing risks despite robust hedging practices. The telecom giant, rated “Baa3 positive" by the ratings agency, is cushioned by its diverse revenue streams, including operations in Sub-Saharan Africa, yet remains exposed to currency volatility.
ANI Technologies, rated “B3 stable" by Moody’s, also grapples with a 90% dollar-denominated debt burden. While its rupee-based cash flows are under strain, Moody’s noted that the ride-hailing firm’s significant cash reserves and net cash position help mitigate refinancing concerns. “ANI's cash flow is rupee-based but
