Infrastructure firms can resist further rupee depreciation: Moody's

Generally, corporate infrastructure issuers have features that shield them to currency weakness

Global Rating agency Moody’s today said India’s rated infrastructure firms can largely withstand further depreciation in the value of rupee against US dollar due to financial hedges and other mitigants. However, a small number of entities are vulnerable if Indian currency depreciates to the mid-to-high 80 range, because of their reliance on imperfect financial hedges.

Corporate infrastructure issuers are generally better positioned to manage their exposure when compared to project finance issuers. They rely on common financial hedges that do not completely eliminate currency risk, said Spencer Ng, a Moody’s Vice President and Senior Credit Officer.

Generally, corporate infrastructure issuers