Thriam
Thriam
LMW
LMW
OEM Update
.

Significant depreciation of Rupee to benefit private upstream oil companies: ICRA

By September 26, 2013 10:23 am IST

The major weakening of Indian Rupee has been over the period from June 2013 to September 2013 and the impact of the same on the financials of upstream companies would get reflected from Q2 FY 14, says ICRA in its latest study on Oil & Gas sector. Significant depreciation of Rupee to offset the impact of diesel price deregulation leading to high level of under-recoveries for FY 14. Indian Rupee has depreciated sharply by around 15% against the US dollar since the beginning of the FY14. ICRA Research expects the under-recoveries to be around Rs 1500 billion for FY 14 at the average Rupee/USD of 62.2 for FY 14 and average crude oil price of US$ 108/bbl factoring in Rs. 0.5 per litre increase in diesel prices on a monthly basis. Under-recovery burden for ONGC and OIL would remain high in FY 14 due to significant depreciation in Rupee against US$ and thus, net crude oil realisations of ONGC and OIL will remain low despite high gross realisations. In this regards, it is to be noticed that the under-recovery of GAIL is expected to remain constant at Rs. 7 billion as evident from the trend of last five quarters, says ICRA in the report. The depreciated level of Rupee against US$ directly translates to the high Rupee denominated profits and cash accruals of the private upstream companies like Reliance Industries Limited (RIL), Cairn India Limited (CIL) etc as their realisations are denominated in US$ and the operating costs are a fraction of the realisation levels. We believe that CIL has upside in revenue potential of Rs. 3.0 billion per annum for every one rupee depreciation against US$, while E&P segment of RIL could have upside potential of Rs. 1.0-1.3 billion per annum for every one rupee depreciation”, says ICRA.

Cookie Consent

We use cookies to personalize your experience. By continuing to visit this website you agree to our Terms & Conditions, Privacy Policy and Cookie Policy.

Tags:
webinar
webinar

Do you want to advertise here? Contact us

OEM Update QR Code
OEM Update QR Code

Events

LWOP
LWOP
IFAT India 2025
IFAT India 2025
India Manufacturing Show
India Manufacturing Show
4th IFFE EXPO 2025
4th IFFE EXPO 2025
Auto EV Bharat 2025
Auto EV Bharat 2025
Laser Engineering Technology Expo
Laser Engineering Technology Expo
Factory Automation Expo 2025
Factory Automation Expo 2025
17th ENGIMACH 2025
17th ENGIMACH 2025

eMagazine July 2025

eMagazine July 2025
eMagazine July 2025

Do you want to advertise here? Contact us

Our Sponsors

B&R Automation
B&R Automation
Pragati Gears
Pragati Gears
Carl Zeiss India
Carl Zeiss India
Maco-c
Maco-c
igus
igus
Delta Electric
Delta Electric
Ravik Engineers Private Limited
Ravik Engineers Private Limited
Cumi
Cumi
Marvel Machinery
Marvel Machinery
UNP Polyvalves India Pvt Ltd
UNP Polyvalves India Pvt Ltd
ENS Oils & Lubricants
ENS Oils & Lubricants
Super Slides
Super Slides
Quality Spares Center
Quality Spares Center
IMTMA- IMTEX 24
IMTMA- IMTEX 24
ACE Micromatic Group
ACE Micromatic Group
Accu Sharp
Accu Sharp
Poonam 3D Prints
Poonam 3D Prints
Chicago Pneumatic Tools
Chicago Pneumatic Tools
Shree Rapid
Shree Rapid
Yash Dynamice
Yash Dynamice
Amsak Cranes
Amsak Cranes
Molygraph
Molygraph
Exorint
Exorint
Exon mobil
Exon mobil