New Delhi ,
A recent CEOs Poll conducted among members of CII National Council, indicates that Indian Economy is set for a strong rebound in 2021-22. This was revealed by 56 percent of the CEOs polled, who indicated that the economy would grow in the range of 9 to10 % during 2021-22, while another 10 percent of the CEOs polled expect the economy may grow at a faster pace of more than 10% this fiscal year.
“Government’s strong emphasis on public works, timely interventions to boost liquidity and several reforms carried out in the recent months including easing regulations, Production Linked Incentives scheme, RoDTEP and several other bold reforms have buoyed the optimism on higher economic growth”, said Mr T V Narendran, President, CII.
The respondents were also upbeat on sentiments regarding their business, with 35 percent of the CEOs indicating that the increase in revenue this year may be in the range of 10 to 20% when compared to pre-covid year (2019-20), while another 33 percent of the CEOs indicated expectations of a bigger jump in revenues (more than 20% increase when compared to the pre Covid year).
On gross profits front as well, 35 percent of the CEOs polled indicated more than 20% increase in gross profits when compared to the pre Covid year, while another 17 percent indicated an increase in growth of profits by 10 to 20%. This optimism among the CEOs is despite more than third of them (70 percent) observing that supply chain bottlenecks were causing problems in the movement of goods in their industry sector.
Further given the pick-up in business activity this year, 59 percent of the CEOs noted that capacity utilization in their companies was currently in the range of 70% to 100%, while 18 percent of them felt that the current capacity utilization would be more than 100%. Nearly a similar proportion (62 percent) of the CEOs polled projected capital expenditure in their companies for the year 2022-23 to be upto Rs 500 crores. Additionally, 71 percent of the CEOs polled indicated that they did not raise resources in the Indian or Global markets in the past year, while 18 percent of them indicated that they had raised debt and another 11 percent indicated that they had raised equity in the Indian or global markets in the past year.
On expected growth in exports, 35 percent of the CEOs polled indicated upto 20% increase in exports when compared to pre Covid year 2019-20, while 24 percent of them indicated that the exports would remain the same as in FY20. Interestingly, about 10 percent of the CEOs indicated more than 50% growth in exports in their companies in the current year when compared to the pre covid year 2019-20.
Furthermore, 36 percent of the CEOs indicated that their exports to East and South East Asia are increasing at the fastest pace, while 22 percent of them indicated that North America contributed to their increase in exports and another 20 percent of the CEOs indicated that Europe accounted for the major increase in exports. On the imports front, 73 percent of the CEOs indicated that less than 10% of their imports came from China, while another 22 percent of the CEOs polled indicated share of their imports from China to be in the range of 10 to 25%.
When asked about the impact of the new Covid Variant – Omicron on business, 55 percent of the CEOs polled expect that services sector would get adversely impacted due to the spread of the new variant, while another 34 percent of the CEOs indicated that the spread of the new variant would adversely impact manufacturing activities.