Conception of Currency Risk Management

A well devised process will instill discipline and guide the management to take decision in mitigating the currency risk. The entire process of managing the risk of various exposures will be set up in a professional way as per the risk appetite and policies of the Management.

Effectively manage the currency risk and protect the bench mark by deploying various hedging tools in line with the risk appetite of the Corporate.The currency portfolio will be managed to achieve the business targets and achieve the projected revenue and protect the Corporate against adverse currency movements which could prove detrimental to budgetary allocations.

 

 

 

 

 

 

 

Composing of Forex Policy

A well designed Forex Policy will define the entire process of hedging techniques, hedging tools, stop loss and take profits levels etc. The decision making will be simple as the Management of the corporate will be a part of the Forex Committee formed for this purpose.

A well drafted and professionally designed Forex Policy is one of the mandatory requirements for Listed Companies for Credit Ratings and Derivative Transactions.

 

 

 

 

 

 

 

 

 

Forex Directional Positioning

The global foreign exchange market is the largest financial market in the world with more than $3.2 Trillion - turnover a day. It’s a 24Hrs * 5 Days market. An over the counter market, highly volatile and operates purely on Supply and Demand. These characteristics make the currency market, the highly liquid market where manipulation is impossible. Technical analysis serves as a barometer to this market. The forward market having validity of 12 months allows one to hold positions till such time. Short trading positions provide an opportunity to get benefited from a falling market also. This makes the Forex Market a Winning Trader’s Market.

The Corporate Treasury is a source of profit generation. This trend line is catching up with most of the Corporates. The highly volatile currency can be a bottleneck in achieving the business targets. The budgeting and profit margins may go awry unless it is combated with alternative skill set. The currency market offers a huge potential to generate revenue from it. Corporates, based on their risk appetite, can take Directional Positions in currencies backed by their Import & Export exposures.

Aditya Forex Service has a proven expertise in this area. We can confidently say that we have mastered this. Aditya Forex Service with a talented pool of Analysts and Financial professionals has now ventured into advisory on Forex Positional Trading. Our clients have reaped rich returns from our trading calls, given after in-depth analysis of both Fundamental and Technical factors.

 

 

 

 

 

 

 

Treasury Outsourcing

The entire treasury operations will be professional managed which will be hassle free and cost effective. The risk will be managed and mitigated to achieve the bench mark and better it. The cost effective structure will be advised on an ongoing basis to protect from Currency Risk as well as Interest Rate Risk. Attractive Low Risk Investment Plans will be advised on timely basis to generate additional income to treasury.

 

 

 

 

 

 

 

 

 

International Trade Finance

We specialize in syndication of ECB (External Commercial Borrowing) finance at international rates (LIBOR, EURIBOR, SIBOR etc.). The international interest rate is most competitive vis-à-vis our local interest rate. The importers can avail this facility through Buyer’s Credit, Supplier’s Credit and ECB Term Loans for project finance. The entire process will be managed by at competitive rates.

 

 

 

 

 

 

 

 

 

Buyer’s Credit

This mode of financing is used to extend the due dates of sight payments of L/C’s or documents. This type of financing is routed through the ECB route where the L/C opening bank or the document routing bank acknowledges the transaction arranged by its customer and gives an undertaking via a SWIFT message to pay the offshore financing bank the principal and the LIBOR related interest amount on the promised future date.

The interest element is determined on the basis of the LIBOR for the concerned currency. For Example the 6-month LIBOR for the USD is currently 0.70 % p.a. The spread over LIBOR at which the financing will be done, varies from 1.00 % to 3.50% depending upon, the size of the transaction, the usance period, the country of import etc.

Benefits of this structure
  1. The supplier can negotiate with his own banker.
  2. Applicant gets the money on a simple undertaking from his banker.
  3. The control of the transaction lies in the hand of the importer.
  4. This transaction can be implemented to make payment to any supplier
    in the globe irrespective of his location
Role of Aditya Forex Service
  1. Arrange cost effective and aggressive rates for financing.
  2. Follow up and Co-ordinate assisting the process of payment to the bank.
  3. The above route can also be adopted in case of Non – L/C or CAD documents.

 

Supplier’s Credit

Supplier's Credit is a term used to refer to financing of an import by an international bank at LIBOR related rates. Simply put, instead of importing on "sight basis" which entails opening a sight L/C, the importer opens a Usance L/C on an international bank (financing bank) where the L/C is restricted for negotiation, discounts the drafts drawn under the L/C so that the beneficiary (Supplier) gets paid at sight and the opener (importer) has to pay, invoice amount and interest, to the financing bank after 180-days.

The interest element is determined on the basis of the LIBOR for the concerned currency. For Example the 6-month LIBOR for the USD is currently 0.70% p.a. The spread over LIBOR at which the financing will be done, varies from 1.00 % to 3.50% depending upon, the size of the transaction, the Usance period, the country of import etc.

Thus, by using supplier's credit an importer is in a position to finance his imports at international interest rates which are significantly lower than those charged by our local banks (usually around prime rate plus spread or the CC rate).

Role of Aditya Forex Service
  1. Arrange cost effective and aggressive rates for financing.
  2. Scrutinize the L/C being issued to the financing bank.
  3. Follow up and Co-ordinate assisting the process of payment to the supplier.

 

 

 

 

 

 

 

 

 

 

 

Structured Finance

Identification and Syndication of various financial products available to suit the risk appetite, transfer and mitigation of risk using structures like securitization, credit enhancement and tranching. We also specialize in syndication of Factoring, Export and Local L/C Discounting, FCNR (B) and Foreign Currency Term Loans.

 

 

 

 

 

 

 

 

 

 

 

 

 

Forex Information Service

Forex Currency Rates and information affecting various markets like currency, commodities, equity and debt market will be provided through various channels like website, emails and SMS alerts. The latest and imperative happenings with analysis and suggestions will be sent through emails intermittently.

Our fortnightly in house magazine “Currency Insight” is quite popular among currency traders and corporates for accurate prediction of currency movements. Our technical analysis has achieved an accuracy rate of 76%.

 

 

 

 

 

 

 

 

 

 

 

Currency Futures and Options

Currency Futures is a standardized exchange traded platform. The rates are transparent and hassle free to trade as no underlying is required. Presently USDINR, EURINR, GBPINR and JPYINR can be traded in this platform.

We provide the service at an attractive brokerage. Any individual or corporate can take advantage of this. We also provide Portfolio Management Services in Currency Trading.

 

 

 

 

 

 

 

 

 

Syndication of Private Equity and Venture Capital

We have tied up with leading Private Equity Players and Venture Capital Funds. We will prioritize on need based approach keeping in view of the Organization goals, Business Model and Risk Appetite of the Company. We will arrange syndication of PE as well VC at the most competitive rates in the business.

 

 

 

 

 

 

 

Forex Audit

We undertake Forex Audit which will be a complementary approach to Forex Risk Management. The Corporate faces the risk of Income Seepage, Regulatory Default, Contingent losses, Currency Risk and Interest Risk etc., We perform Forex Audit on a practical scale within the business model and risk appetite of the Corporate.

We will provide suitable suggestions and solutions on Forex Risk which will enable the Corporate to take rational decision, mitigate the risk and implement regulatory compliance on account of exposure to Foreign Exchange.