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Indian CFOs Bullish on New Investments: AmEx Study

Indian CFOs are planning to increase their investment and spending activites this year

Published: Jul 1, 2014 06:37:12 AM IST
Updated: Jul 1, 2014 08:14:02 AM IST
Indian CFOs Bullish on New Investments: AmEx Study
Image: Reuters

Prime minister Narendra Modi’s promise of a better economic climate and the continued optimism on the street has rubbed off on chief financial officers (CFOs) of Indian companies.

The seventh edition of the annual American Express/CFO Research Global Business and Spending Monitor found that 100 percent of CFOs in Indian companies “plan to increase their investment and spending activities this year”.

The study, conducted globally, says these CFOs have “demonstrated a leap of faith on local economy” as compared to their counterparts in China, Hong Kong and other Asian countries; and they are increasing their spends on creating office infrastructure, travel and recruitment.

However, there is a catch: While all of them see their investments increasing, only 13 percent of them see their spending increasing by 30 percent; about 40 percent see their spending and investment increasing by 15 percent.

Investments, therefore, are not high, as the CFOs are still cautious about how the optimism will play out through the year.  There is more reason to believe this as some of the biggest investment items are meant to save costs: The CFOs are spending most on computer hardware (67 percent); other top items include enterprise-level IT systems (55 percent).

Reason? Seventy percent of the CFOs think improving the company’s IT will improve efficiency and productivity and reduce costs, the study found. The research was done among senior finance executives of companies with minimum revenue of $500 million, and the largest company having a topline of $20 billion.

(This story appears in the 11 July, 2014 issue of Forbes India. To visit our Archives, click here.)

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