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Exide says may raise prices if Rupee dips below 61 vs dollar

KOLKATA: Exide IndustriesBSE 1.78 % today said it is monitoring rupee volatility and may take a call on reviewing product prices if the domestic currency slips below 61 level against the dollar. 

The company also said that its Rs 280 crore capex plan remains on track for 2013-14. 

"We are watching rupee. We are protected up to an exchange rate of Rs 61 against the dollar. Prices of lead has slightly softened but if 
US dollar continues to appreciate against rupee beyond Rs 61 then we may have to raise prices again," Exide Managing Director P K Kataky said after the AGM. 

The Kolkata-based company has already raised prices of its products recently with the quantum of increase being 5-6 per cent. 

The Indian currency has fallen over 9.37 so far this financial year to close at Rs 59.89 to a US Dollar after touching a low of Rs 61.20 recently. 

"Though lead prices have softened over the last few months, but there is a high premium for physical delivery of lead globally. This is due to a sharp rise in demand for the metal in the US where auto sales rose in June." 

With slowdown in the OEM market or sales to automobiles coming out of actories, capacity utilisation has come down to 72-75 per cent. 

"We don't see the OEM market reviving soon, maybe in the second half after the monsoon effect comes in and sentiment improves," Kataky said. 

The depreciating rupee and the rising input prices has already impacted the operating margins of the company, 
Katakay said. 

"During the April-June quarter our operating margins stood at around 16 per cent and under the present circumstances, we are looking to maintain it at that level in the current quarter (Jul-Sep)," he said. 

Exide posted a 4.44 per cent jump in net profit year-on-year for the Q1 period of 2013-14. 

Exide Industries has lined up capital expenditure of Rs 280 crore in 2013-14 to support its ongoing capacity expansion plans. 

This includes an investment of around Rs 70 crore in its Pune plant.