Biz climate improving: D&B survey

The raft of reforms recently ushered in by the government has led to a significant improvement in the confidence levels of senior finance executives, findings of a survey revealed.

Research firm Dun and Bradstreet India Chief Financial Officer (CFO) survey revealed that top finance officials in the country feel that by the October-December quarter business and macro economic conditions will improve leading to a spur in business in this quarter.

Compared with last year, business sentiment in the country has reached a three quarter high.

The optimism level for the overall macroeconomic condition for the fourth quarter of 2012 stands around 60, an 8.1 point increase from the previous quarter, the survey said. Optimism level ranges from 0 to 100 — 0 being pessimistic and 100 being optimistic.

“The recent reform announcements have lifted sentiment within the domestic industry and renewed interest of Foreign Institutional Investors in the Indian market,” Dun and Bradstreet India COO Mohan Ramaswamy said.

In its recently announced reform measures, which were released in two sets, the government among other initiatives opened FDI for multi-brand retail, allowed foreign airlines to pick up 49 per cent stake in Indian domestic carriers, capped the number of LPG cylinders to six per household a year and also removed a portion of subsidies on diesel leading to a hike in price of the fuel.

In the second instalments of reforms, the government opened the pension sector to foreign investment and raised the foreign direct investment (FDI)  cap in insurance to 49 per cent.

The survey revealed that about 56 per cent of CFOs believe the macroeconomic scenario for Indian corporate will remain favourable during fourth quarter of 2012, which is an increase of 29 per cent over the third quarter of 2012.

About 50 per cent of the surveyed CFOs consider operating margin of their company to improve in the fourth quarter of 2012.