10 stocks that will gain from a weak rupee: Goldman

Moneycontrol Bureau

While the falling rupee has roiled the stock market and rattled the government, there are companies that stand to gain from the depreciation of the currency.

Here are 10 of them, as identified by brokerage house Goldman Sachs

Apollo Tyres 

Translational gains from overseas subsidiaries plus exports from India operations offset by imported raw materials and marked-to-market on USD denominated balance sheet debt.

Also Read - These 15 companies will feel the pain of a sinking rupee 

Bajaj Auto 

Around 37 percent of revenue is through exports, but about 70 percent of FY14E is hedged at a fixed rate. Spot currency rates can impact FY14E hedges, which are currently being negotiated. We see about 2 percent  impact on FY14E EPS of Rs 1 change in rupee/USD.

Bharat Forge 

Potential impact from marked-to-market of foreign debt along with translational impact from losses at overseas subs more than offset by transactional gains from significant export revenues from India operations to Americas, Europe and Asia Pac regions.
 
Cairn India 

Significant positive impact as Cairn prices its crude sales in dollars leading to higher revenues and profits
 
Coal India 

We have assumed increase in E-auction / Grade A&B coal prices, in-line with rupee depreciation contributing Rs 1.7 bn / Rs 1.9 bn to PAT. Foreign debt of Rs 13 bn primarly in USD & yen from world bank in 1998 at less than 2 percent rate for rehabilitation purpose.

Essar Oil 

Positive impact on revenues and profits as majority of revenues are dollar denominated, partly offset by interest on foreign currency debt. The company hedges its currency exposures to the extent it deems appropriate

HCL Technologies 

The EPS sensitivity is assuming entire benefits of rupee depreciation is passed through P&L and not retained for reinvestment and without accounting for the impact of hedges. Currently they have a hedge position of USD 1.6 bn which is around 29 percent of their FY14E USD revenues

Infosys 

The EPS sensitivity is assuming entire benefits of rupee depreciation is passed through P&L and not retained for reinvestment and without accounting for the impact of hedges. Currently they have a hedge position of USD 1,100 mn which is around 14 percent of their FY14E USD revenues.

Mphasis 

The EPS sensitivity is assuming entire benefits of rupee depreciation is passed through P&L and not retained for reinvestment and without accounting for the impact of hedges. Currently they have a hedge position of around USD370 mn which is roughly 33% of their FY13(estimated) USD revenues

Reliance Industries

Net positive impact of about 4-5 percent on earnings. Higher revenues and profits as 60 percent of RIL's turnover is exports, partly offset by higher outgo on foreign currency debt. The company hedges its currency exposures to the extent it deems appropriate.