Parul
A recent survey of Chief Financial Officers (CFOs) in India, conducted by Dun & Bradstreet India, a leading global provider of business decisioning data and analytics, found that CFOs’ confidence in financial conditions and macro-economic conditions have improved significantly compared to the same period previous year.
The Dun & Bradstreet India Composite CFO Optimism Index analyses the optimism level of CFOs on 12 parameters: operating margin, liquidity position, level of financial risk on company’s balance sheet, risk appetite, need for raising short-term and long-term funds, cost of raising funds, availability of funds, domestic and global macroeconomic scenario, overall scenario for mergers and acquisitions, and level of financial risks for businesses.
Key findings from the survey:
• The Composite CFO Optimism Index stands at 95.1, an 11.1 per cent increase on a y-o-y basis.
• Optimism level for overall macroeconomic scenario increased by 26.7 per cent (y-o-y) in the industrial sector.
• 14 per cent of CFOs expect the cost of raising funds from the market to reduce, reflecting an improved optimism over five quarters.
• Optimism for the domestic macro-economic scenario has improved significantly to 72 per cent in Q3 2023, which is the highest in 10 quarters.
• Optimism for the global macro-economic scenario stands at 37 per cent in Q3 2023, which is the highest in 6 quarters.
• Only 27 per cent of CFOs are optimistic about the risk appetite of firms in the current scenario, which is the lowest in 10 quarters.
Commenting on the findings of the survey, Dr. Arun Singh, Global Chief Economist, Dun & Bradstreet, said, “The increase in optimism for financial performance is being driven by the expectation of higher operating margins as the producer prices are steadily moderating along with improvement in supply chain. While high interest rates continue to cause discomfort amongst CFOs, the recently articulated dovish outlook by RBI offers some respite to CFOs regarding gradual decline in costs of raising investment and working capital as well as improved credit availability in the market. The decrease in global commodity prices and deflationary trends across markets globally contribute to heightened optimism towards domestic as well as global macroeconomic conditions, for the first time in five quarters”.
