"Food and beverage vendors and technology firms are most vulnerable among those Turkish companies with hard currency debts to the lira’s sharp depreciation, according to a survey of 10 corporations by Fitch, the credit rating agency.
Assuming a 30 per cent depreciation in the lira against a basket of currencies since the end of 2012, Fitch examines which companies have the highest proportion of their earnings in lira versus debts in hard currency – a transgression known as “original sin”.
The results are mixed. Fitch points to disparities across sectors and companies to gauge how well they can cope with a cheaper lira. Some, especially manufacturers, have a sizable proportion of their revenues in foreign exchange which hedge against foreign currency debts. Others, such as Hurriyet Media, are guilty of original sin and have virtually none.
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| Source: Fitch |
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