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Mumbai, Nov. 19 Mr K.V. Kamath, Managing Director and CEO of ICICI Bank, on Monday advised Indian companies to prepare themselves for a stronger rupee.

He felt that the rupee was likely to strengthen by one to two rupees a year against the dollar in the next few years.

“You (companies) should balance the risk of a strong rupee with appropriate market diversification, hedging and increasing efficiency levels,” he said at the sixth Manufacturing Summit got off by the CII here.

Mr Kamath said the greenback was weakening generally against all currencies and “we are going to see the rupee strengthen.”

The rupee has gained more than 12 per cent in the last one year between September 2006 and September 2007 and is currently trading at levels of 39.33 against the US dollar. According to forex dealers there is no reason for the rupee to weaken, as FII inflows continue to be strong and the dollar is taking a knock against all other currencies.

The rising rupee has hit export-oriented industries like IT, textiles, diamonds and jewellery.

“Domestic sales are doing much better than exports,” said a forex dealer.

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