India CFO Survey 2017: CFO Signals
Optimism towards India’s economic outlook has improved significantly
India CFO Survey 2017 conducted by Deloitte highlights the stance of CFOs in India on various facets of Indian economy, investment climate, industry expectations and CFOs’ role and readiness.
- 69% CFOs feels that compliance to the changing regulatory environment is a near-term priority.
- 56% of the CFOs seem to be ‘very optimistic’ about economic prospects over the next 4-5 years.
- 44% CFOs expressed their interest in concentrating more on current geographies versus entering new markets.
- Optimism with respect to India’s medium to long term economic outlook has improved significantly among business leaders relative to last year’s survey. 30% and 56% of CFO’s are now ‘very optimistic’ about economic prospects over the next 2-3 years and 4-5 years, respectively. An increase from 22% and 47% in 2016.
- Over a half of the CFOs (54%) reported no significant impact of demonetization to their industry, while 15% of them stated a positive impact. Less than one third of the CFOs reported a negative impact of demonetization on their industry.
- From an enterprise perspective, technology integration/ upgradation (23%) and analytics solutions (17%) continue to dominate CFOs key focus areas. This is due to the increasing importance of technology and analytics for decision making and strategy of the organization.
- Among key regulatory changes, GST implementation seems to be the biggest concern for 31% of CFOs; which mainly comprises CFOs from Manufacturing (29%) and Technology, Media and Telecommunication (21%) sectors, as evident in the survey.
- 44% CFOs believe in concentrating more on current geographies vs entering new markets (of this, over 50% CFOs are from Energy, Manufacturing and Technology, Media and Telecommunication sectors).
- External risks – with constant changes in regulations and policies, efforts required for the adoption and implementation is huge and 33% respondents believe regulatory impediments and uncertainty in tax environment are the two major risks companies are facing currently.
- The survey reveals that business activities are largely centralized. The top most centralized in-house business activities are long-term financing (73%), working capital (72%), M&A deals (64%) and business planning & strategy (62%).
- The top-most priority for CFOs is compliance to the changing regulatory environment, with 69% CFOs responding that it is a near-term priority. It is followed by 61% CFOs stating that internal control and streamlining is their near-term priority.
About the India CFO Survey 2017 report:
The report is based on responses from over 200 CFOs with revenues spanning from less than INR 500 crores to more than INR 2500 crores. The respondents include listed and unlisted companies, from both private sector and PSUs; Indian companies, MNCs headquartered in India as well as overseas. It also encompasses industries across the sectors, including consumer business, energy.
India resilient in the face of adversities: Press release
According to Deloitte’s annual CFO Survey, for 2017, CFOs are already on the road to recovery from the recent economic and regulatory disruptions, willing to take investment risks. Given macro-economic trends that point to a possible global growth revival, there will be opportunities to increase exports and investment which have been a concern for the past few quarters.