Client Profile
A Greater Noida-based electronics company specialising in importing electronic components from China, with significant exposure to USD. The company imports goods worth Rs. 175–200 crores annually and faces substantial foreign exchange risks due to fluctuations in USDINR rates, high interest costs on financing, and reliance on a suboptimal banking partner.
The Challenge
High Interest Costs
Financing operations with high-cost credit eroded profit margins. Existing banks failed to provide efficient non-fund-based lines.
Excessive Bank Margins
Private bank charged extremely high margins: 40 paisa on USD and 20 paisa on CNY.
Currency Volatility
Vulnerable to USDINR and USDCNY fluctuations. Payments were made on due dates without hedging, exposing them to risk.
Dependency Risk
50% of imports routed through a partner company using borrowed limits, paying fixed fees and facing further forex overcharges.
The Myforexeye Solution
Bank & Treasury Access
Negotiated forex transaction costs down from 40 paisa to 5 paisa (USD) and 1 paisa (CNY). Introduced a new bank for term loans and working capital.
Strategic Hedging
Recommended hedging 30% of six-month exposures at avg. rate of 84.50/USD. Saved Rs. 15 lakhs on realised payments in 3 months.
Optimising Banking Products
Shifted from Cash Credit (9% interest on Rs.20 crore) to Buyers' Credit, saving 1.5% on financing costs over three months.
New Bank Introduction
Raised Rs. 15 crores via debt syndication for machinery and working capital from a large private-sector bank.
Results & Impact
₹ 36 Lakhs
Total savings in just 3 months through optimised Forex and treasury operations.
₹ 15.5 Lakhs
Saved purely by reducing bank forex transaction margins (40p -> 5p).
₹ 15 Lakhs
Saved via strategic hedging on realised payments.
₹ 15 Crores
Funding raised via debt syndication for capital outlay.
Conclusion
Through expert advisory, Myforexeye helped the client overcome significant financial challenges. Strategic adjustments in Forex rate benchmarking, hedging, and financing not only saved the client Rs. 36 lakhs over 3 months, but also strengthened their financial resilience — positioning them for future growth and improved profitability in a highly competitive market.