Vol: 13, Issue: 3 2023

Page: 078-090

Impact of Real Effective Exchange Rates Changes on the Top 500 Firms of the BSE From 2014 - 2015

Nish Patel, Dhananjay Shanbhag

http://doi.org/10.37648/ijtbm.v13i03.007

This Paper studies the impact of real effective exchange Rates on the Performance and profitability of the top Indian firms from 2014 to 2015. This paper uses various regression models to examine the factors affecting the performance of the top 500 firms on the Bombay stock exchange. This study will analyse the correlation between REER and business performance indices by exploring changes in import and export patterns through foreign exchange liabilities. Since the export and capital goods sectors have a more significant impact on the firm's performance, revenue and profitability, they outperform the impact of the import sector. The BSE 500 is a market-weighted index that works on a free-float system; This paper talks about all the significant sectors in the Indian economy. In the following article, we will look at factors such as revenue and profits, growth rates, resource utilisation, forex spending and exchange rate changes to analyse the effect on firm performance. Through these factors, we can see a clear relationship between the stock performance of the firms and the changes in REER. Along with these leading indices, we will explore larger ratios to help mitigate the impact of exchange rate fluctuations on Indian firms. In the following analysis, all the above factors positively correlate with the REER.