Side effects of rupee fall down on corporate companies

Rupee decline

 

The cost of rupee was fall down in a record low value of 68.80 on Monday and sensex also effects in the same way. It is the biggest fall since September 22, 2011 and government and central bank have also started to take measures to control the fall down. This year rupee has fall down nearly 13 percent as compared to last year. This crash has noted worst performance of the rupee. Weakening rupee has impact on economy and it slowing the economy growth and caused to volatility in financial markets and corporate sector. Many home loan banks have increased interest rates but there will be no effect for fixed interest rates on home loans but there will be adverse effect on floating interest rates based loans. Fall in rupee not only affects the corporate and it also hits the common man in different ways like costs, pay, jobs.

Fall down of rupee impacts many Indian companies in negative way. Some companies like whirlpool, Videocon says that jump of rupee value will increases the cost of imports and need of raise the cost of products which makes customers in dilemma. This will affect more consumer sales based companies like car makers to soap makers also. Already many companies affected by financial crisis of 2008 and recovering now and it is the big hit for them to recover again. Videocon imports raw materials from other countries and these prices raised by 2 to 3 percent and definitely it will affect the prices of consumer goods. Consumer’s goods like electronic items sales will boost in festival seasons like diwali, ganesh chathurdhi, Christmas and the increase in prices will make the customers to take step back. Another consumer items producer Hindustan lever limited already recorded lower sales records in last quarters. Another retail store Provogue India limited closed some of its stores since last year and moving ahead with a new focus.

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