Fitch Ratings has highlighted growing risks for Indian companies due to recent US tariffs. The US has imposed a 25% reciprocal tariff on India starting August 7, 2025, and a 25% levy on Russian oil imports from August 27, 2025.
Impact on Automotive Sector
In the automotive sector, Samvardhana Motherson International is significantly exposed, as nearly 20% of its sales come from the US. Fitch has revised the company’s outlook from Positive to Stable due to this tariff risk.
Impact on Pharmaceuticals Sector
The pharmaceuticals sector also faces challenges. Biocon Biologics generates around 40% of its revenue from the US. The company has limited ability to pass on higher costs because of strong competition, making it vulnerable to tariffs.
Impact on Crop Protection Chemicals
UPL Ltd, which derives 10%-12% of its revenue from US customers, may face competitive pressure. As tariffs on Indian products approach those on Chinese goods, the company could experience a tougher market environment.
Impact on Oil Marketing Companies
Indian oil marketing companies (OMCs) are exposed as Russian crude accounts for 30%-40% of their imports. A complete halt in imports could reduce EBITDA by roughly 10%. State-owned OMCs are expected to maintain credit ratings due to government support, while HPCL-Mittal Energy is more vulnerable because of a lower rating buffer.
Other Sectors
Fitch expects minimal direct impact on IT services and domestic sectors such as cement, telecom, and utilities. However, sustained higher US tariffs could moderately affect India’s projected economic growth of 6.5% for the financial year 2026.
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