The Hindu Business Line : HCL Tech sees $75-m forex loss in June quarter

New Delhi, July 11 The sudden weakening of the rupee from April has taken a toll on the outstanding forex hedging position of India’s fifth largest IT services company HCL Technologies.

The company has estimated the foreign exchange losses to be between $65 million and $75 million for the fourth quarter ended June 2008. The greenback appreciated against the local currency by 7.3 per cent in the just-concluded quarter.

In a statement issued here, the company pointed that as part of its proactive treasury policy and to put a stop loss, the company unwound $540 million of forward covers and incurred cash loss of $9 million.

“For the full year ended June 30, 2008, the company would be incurring foreign exchange losses of $67-77 million,” it said.

HCL, which would announce its results on August 1, had recorded a foreign exchange gain of $79.2 million during the previous fiscal year ended June 30, 2007.

The company said that even as the dollar in the just-concluded quarter had appreciated against the rupee, “the 12-month forward premiums have firmed up from Re 0.67 to a dollar as of March end to Rs 1.77 as of June end.”

HCL has been following the policy of hedging its foreign currency inflows against the fluctuations by taking forward covers.

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