Dun & Bradstreet India conducted a pan India survey of Corporate CFOs in which they were asked about their confidence in the overall financial and macro-economic conditions for Q4 2012 (Oct-Dec of the calendar year 2012), as compared to the same quarter of the previous year. The survey revealed interesting facts about the CFOs’ perspective on the overall Business Climate:
- The optimism level for the overall macroeconomic condition for Q4 2012 stands at ~60, an 8.1 point increase from the previous quarter led by increase in the optimism level of CFOs in the industrial sector (Optimism level ranges from 0 to 100; 0 being pessimistic and 100 being optimistic)
- Around 56% of the surveyed CFOs revealed the macroeconomic scenario for Indian corporate to remain favourable during Q4 2012, an increase of 29% over Q3 2012.
- Around 50% of the surveyed CFOs consider operating margin of their company to improve during Q4 2012
- Of the surveyed CFOs, 39% expect cost of funds to decrease in Q4 2012 as against only 23% in Q3 2012 who expected this to happen in the immediate future. Further, 50% of the surveyed CFOs expect availability of funds to increase during Q4 2012, an increase of 15% over Q3 2012
- Around 70% of the surveyed CFOs wish to prioritize their focus on overall cost control. 47% of surveyed CFOs prefer to focus on overall cash flow management during the next six months
- Effective recovery system and increase in close monitoring of strategic accounts have emerged as the most preferred mode of risk management for CFOs during the next six months
Commenting on the findings of the survey, Mohan Ramaswamy, Chief Operating Officer of Dun & Bradstreet India said, The CFO survey conducted by D&B India reveals that the optimism level among the CFOs stands at a three quarter high. The recent reform announcements have lifted sentiment within the domestic industry and renewed interest of foreign institutional investors in the Indian market. However, CFOs still remain cautious with respect to the overall cost structure. Inflation is on the rise and the second round impact of the fuel price hike announced by the government during end of Q3 2012 is yet to materialize fully. Thus, controlling cost and proper cash flow management has probably emerged as key priorities for majority of the CFOs which would aid in protecting margins. Further, CFOs expect liquidity conditions to improve and the overall cost of funds to ease during the forthcoming quarter.
Source: D&B India Press Release