The Hindu Business Line : Financial executives looking to expand market reach: Survey

Bangalore, June 14 Senior financial executives of India, other Asian countries and Australia plan to invest in growth by actively looking to expand their market reach, invest in new production capacity, new product and service development and increase headcount.

At the same time Chief Financial Officers plan to allocate more capital to shareholders through dividends or share buybacks, according to the results of a survey of 370 senior financial executives from around the world.

An American Express CFO Research Global Business & Spending Monitor said with eight out of ten respondents from India, other Asian countries and Australia are expecting their primary industry to grow and their company’s revenue to increase over the next year.

The companies, however, are looking back to their actions during previous downturns to help guide them towards growth this time around. Eighty-one per cent said their investment priorities have changed in light of recent economic developments.

Mr Firdaus Mogul, Head, American Express Commercial Card, India said, “In India, as elsewhere, rising energy costs are an urgent concern. While companies plan to be conservative in their spending, they’re also looking to enhance investments in growth areas and are actively pursuing opportunities to expand market reach.”

Mr Pashupati Kumar V., Chief Financial Officer (Region 10), Deloitte Consulting India Pvt Ltd, “Generally speaking, I would agree with the findings. He said companies have learned from the last downturn and they are not going to over react this time around but will play things carefully. In India, businesses are most concerned about capital costs which are constantly rising. Interest rates and inflation are a real concern. Additionally, wage inflation has increased significantly and there is no indication of the same cooling down.”

Of the companies surveyed in India, other Asian markets and in Australia, 35 per cent said they should have invested more in product and service development during the last economic downturn compared to 23 per cent globally, while 40 per cent said they should have invested more in market access compared to 34 per cent globally.

“While it is hard for one to deny the uncertainties of today’s economic climate, companies in Asia and Australia are looking for ways to maintain their growth momentum and are a lot more optimistic than their counterparts in the US and Europe,” said Mr Tracey Bowra, Senior Vice-President, Global Commercial Card at American Express Japan, Asia Pacific and Australia.