Tata Consultancy Services Ltd. (TCS), India’s largest software exporter, led the nation’s technology companies lower on concern the rupee’s gain to a four-month record will reduce the value of their earnings.
Tata Consultancy fell 5 percent to 1,342.10 rupees, the most since May 8, at the close in Mumbai trading. Infosys Ltd. (INFO) declined 2.6 percent to 2,564.50 rupees, the most since July 16, and shares of Wipro Ltd. (WPRO) fell 1.7 percent to 384.80 rupees. The benchmark Sensitive Index climbed 0.4 percent.
The rupee, Asia’s worst performing currency in the past six months, rose after the government allowed overseas retailers to invest in Asia’s third-largest economy and said foreign airlines can own minority stakes in local carriers. A stronger local currency hurts exporters because it reduces the value of repatriated earnings.
“The IT companies have gained a lot from the depreciation of the rupee recently,” said Ankita Somani, an analyst at Angel Broking Ltd. in Mumbai. “Now they’re going to lose some of that with all these reforms that have come in, strengthening the rupee.”
The rupee touched 53.6550 today, the strongest level since May 15.
Tata Consultancy derived 91.4 percent of its revenue from outside India in the year ended March 31, according to its annual report. Infosys got 97.8 percent of its revenue from overseas India in the year ended March 31, the company said.
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