Rising rupee may hit steel firms' margins

Industry expects a robust demand with the govt allocating Rs 396k cr to the infra sector in Budget

The appreciating rupee is likely to hit the margins of steel companies that have been depending heavily on exports.

Steel companies over the past year have managed to overcome muted domestic demand because of a buoyant export market. But that buffer is now under threat.

“The five per cent appreciation in the rupee will hit the margins of steel companies. The bigger steel companies have been relying on exports to tide them through,” said Jayanta Roy, senior vice-president, ICRA. “Though a reduction in the import cost of coking coal will cover a bit of that impact, it will not be