A JP Morgan survey found out that more than two thirds of Indian medium and small scale enterprises ( MSMEs) are seeking to invest in expanding capacities this year even though the pressures of price continue to bite.
The JP Morgan survey also found out that more than half the companies are leaning towards providing flexible working hours and are inclined to pass on the increased prices to customers that could keep the inflation high.
302 Chief Financial Officers (CFOs), heads of finance and Chief Executive Officers (CEOs) were interviewed online between November 21 and December 8, 2022 as per the JP Morgan survey.
The annual revenues of these companies range from Rs150 crores to Rs 16,000 crore. 91% of these companies anticipate their revenues to increase this year and more than 84% are expecting that their profits will also climb as found by the survey.
The rising cost is the challenge taking the top spot with 78% of the business leaders surveyed experiencing the rise of cost for their respective businesses, a huge majority (78%) expect capital expenditures and capital needs (82%) to increase and are, hence scaling their activities in business accordingly.
According to Pranav Chawda, head of commercial banking, India for JP Morgan said that aside from inflation, disruptions of supply chain have affected companies.
These comprises disruptions in relations to vessels and ports and freight rates for companies that are manufacturing or process and people related issues for service linked companies.
However, Indian companies overall have benefited from global China – plus one shift. Sectors like specialty chemicals and agro chemicals have witnessed that orders are doubling because several buyers from Europe and the US have diversified away from China.
Pranav Chawda stated that clients in India are more positive than their counterparts residing in the UK and the US.
The results of the survey help us to expect that India will carry on a trajectory in upward direction as businesses are exploring advanced and new distribution channels globally, in addition to creating strategic partnerships and seeking investment opportunities to grow, as stated by Pranav Chawda.
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