The global meltdown changed the growth-oriented objectives of Indian businesses, and there was a renewed focus on operational effectiveness to ensure survival and companies undertook various measures to achieve this as per a PricewaterhouseCoopers survey, Beyond the Downturn.
With over 91 per cent respondents implementing significant cost reduction and 70 per cent reviewing operational/working capital cycle, India Inc. seems to have mitigated the impact of the meltdown on their businesses. With the economy appearing to be on a path to recovery, India Inc. is cautiously optimistic about its prospects and is beginning to assay growth again but is still wary of large capital commitments.
Strong domestic economy, stable banking and financial system, and timely government intervention were cited as key factors responsible for the reduced impact of the downturn on India. These factors are also cited as the key to expectations around a faster economic recovery.
Business leaders voted for organic growth as a key strategy for growth over the medium term. The respondents identified risk appetite, market growth and funding availability as key constraints in taking advantage of existing and emerging acquisition/ alliance opportunities.
Bharti Gupta Ramola, Leader - Financial Advisory Services, said, "We believe that the focus is more on organic growth and that acquisition opportunities would be more rigorously scrutinised, but these times offer unparalleled opportunities to Indian companies buoyed up with domestic demand to achieve world-class scale. We believe that Indian entrepreneurs should not let this opportunity go unaddressed."
The survey was conducted amongst the CEOs, CFOs and group heads of diversified Indian businesses to understand what India Inc. feels about the impact of the downturn on their business prospects.
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