The Hindu Business Line : Strong rupee will boost cos’ profitability by 12-15%: Assocham

New Delhi, Feb. 7 Cheaper import cost of raw material and technology on the account of rupee appreciation is likely to boost the profitability of companies by 12-15 per cent, said the industry chamber Assocham.

“The sectors that are likely to gain with rupee becoming stronger include petro and petro products, engineering goods, gems and jewellery, drugs and pharmaceuticals as these have imported inputs with respective percentages of 77.18, 21.55, 92.44 and 19.41,” said the Assocham President, Mr Venugopal N. Dhoot.

Major impact

Apart from these, the major impact of rupee appreciation so far, has been felt by the agro and food processing, auto and auto components, leather and leather products and cotton, textiles and apparel sectors with respected imported inputs of 11.73 per cent, 13.54 per cent, 15.66 per cent and 10.11 per cent, he said. The Assocham paper states, “If companies are able to expand their capacities in the rupee appreciating scenario, in the long run there definitely would be a win-win situation because demand for Indian products in developed countries is not going to slowdown.

“India Inc would be able to export more at very competitive prices as a result of capacity building through technological advancement and increase its margins by 10-15 per cent.”

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