The Rupee fell to a record low of 96.3 against the US Dollar on Monday, boosting the fortunes of Indian IT companies like Infosys Ltd., Tata Consultancy Services Ltd., Tech Mahindra Ltd., and midcap IT names like Persistent Systems Ltd. and Coforge Ltd..

A weaker currency is generally positive for Indian IT companies as most of the Indian IT companies get their revenue from the US Market, predominantly in the US Dollar, along with other foreign currencies, including the Euro. However, most of their employee costs or operational expenses are in local currency, thereby providing a boost to their margins.

In other words, when the rupee depreciates, every dollar earned translates into a higher value when converted back to Indian currency, directly boosting reported revenue figures and expanding operating profit margins.

By 02:40 PM, the Nifty 50 had recovered by nearly 300 points, and the Sensex by 1,000 points, led by gains in IT stocks coupled with a recovery in index heavyweights, HDFC Bank, and Reliance Industries Ltd.