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By Dr. Arun Singh,
Chief Economist
Dun & Bradstreet India
18-Dec-20

CFO Optimism Index

Dun & Bradstreet Composite CFO Optimism Index analyses the optimism level of CFOs on 12 parameters: operating margin, liquidity position, level of financial risk on company’s balance sheet, risk appetite, need for raising short term and long term funds, cost of raising funds, availability of funds, domestic and global macroeconomic scenario, overall scenario for mergers and acquisitions, and level of financial risks for corporate sector as a whole.

The survey of the CFOs also revealed the following insight on the overall business climate in India:

  • The macroeconomic scenario sub index value at 87.5 is the lowest in nearly seven years, the index was at its lowest value of 77.5 during Q4 2013. The financial performance sub index is at its lowest value of 67.1 during Q3 2020
  • Optimism levels for financial performance of the company declined by 21.0% (q-o-q) and optimism level for macroeconomic scenario declined by 4.6% (q-o-q)
  • The percentage of CFOs expecting an increase in the operating margin (21%) and liquidity position (20%) of their companies is the lowest ever
  • The percentage of CFOs indicating a need for raising short-term funds (22%) and long-term funds (15%) is the lowest ever
  • 23% of CFOs expect the global macro-economic scenario to be favourable during Q3 2020, which is lowest in eight years
  • 41% of CFOs expect the domestic macro-economic scenario to be favourable during Q3 2020, up from 31% in Q2 2020
  • 68% of CFOs have stated cash flow management to be their priority in the next six months

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