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Weak Rupee to Spur IT Rebound
Mint Chennai
|February 21, 2025
The Indian information technology (IT) sector has been trying to make a meaningful comeback for a while.
The good news is there's some respite on the horizon at last. The rupee is depreciating against the US dollar and other developed-market currencies, hurt by the ongoing global turmoil.
The rupee hit an all-time low earlier this month, breaching 87 to the dollar as improving prospects of the US economy gave the greenback a boost. So far in 2025, the rupee has declined by 1.3% against the US dollar, 1.4% against the euro, and 1.8% against the British pound.
From a macro perspective, a sinking rupee spells trouble, mainly for importers, but India's IT firms are exporters of services and a large part of their revenue is denominated in these currencies. So, a depreciating rupee augurs well for the sector's revenue growth and margin outlook.
This story is from the February 21, 2025 edition of Mint Chennai.
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