mumbai for indias diversified enterprises the rupee touching a record low against the dollar is a doubleedged sword this is because businesses that are majorly into exports for example it services textiles agricultural produce and engineering goods will fetch better value for their products services in overseas markets pegged to the american currency but businesses that depend on imported raw materials will see production costs going up also businesses that earn revenue in indian rupees and rely heavily on dollar debt to finance operations will face heightened risk of default on borrowingshowever several large companies have protections to limit the effect of the rupees weakness on their cash flows and leverage according to ratings firm moodys they have hedged their exposure to dollar debt and raw material import costs against export earnings and other financial hedges it said while exportoriented businesses will benefit from the rupees slide as their products and services will become more competitive in the global market the benefit will be limited amid the current macroeconomic environment of the russiaukraine war inflation and tightening of global liquidity among other factorstata group company voltas will see an impact on profitability as it imports certain raw materials in dollars but the company maintains at least 25 of its exposure hedged further earnings from the middle east and mozambique projects acts as a natural hedge against exchange rate volatility according to sharekhan by bnp paribas vp research sanjeev hota with regard to another tata entity tata motors hota said a 1 depreciation in indian currency will reduce its operating profit by 75 or rs 499 crore this fiscal because of its dollardenominated debt while tcs which has no us dollar debt is likely to witness crosscurrency headwinds on its dollar revenue growth this fiscal based on the sharp resurgence of the greenback against other major global currencies hota expects a marginal benefit to reflect on tcss fy23 margins on account of the rupee depreciationin the case of aditya birla group companies aditya birla fashion retail and grasim a 5 depreciation in indian currency will reduce their operating profits by about 1 this fiscal the impact is minimal on grasim as its foreign currency loans have been fully hedged for foreign exchange and interest rate fluctuation by way of currency and interest rate swaps and longterm forward contracts hota saidon the other hand reliance industries will see its operating profit increase by 1 or rs 1300 crore this fiscal for every re 1 depreciation as the margins of its oiltochemicals and upstream businesses are pegged in american currencyprofit of jsw steel is expected to fall by 3 or rs 659 crore for every 1 fall in the indian currency as certain raw materials and 57 of its consolidated financial liabilities are in us dollar terms while domestic steel volumes are denominated in local currency thus the rupeedollar rate of rs 80 will have a negative impact of rs 3300 crore on jsw steels consolidated profit hota said