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Business optimism for Jan-Mar quarter turns positive: D&B survey

Business optimism has turned positive on a year-on-year basis for the ongoing quarter after witnessing negative growth throughout 2020, according to a survey

Topics
Business sentiment | D&B report | Economic recovery

Press Trust of India  |  New Delhi 

Representative image. Photo: Shutterstock
Representative image. Photo: Shutterstock

Business optimism has turned positive on a year-on-year basis for the ongoing quarter after witnessing negative growth throughout 2020, amid rising consumer demand, higher businesses transactions and normalisation of supply disruptions, according to a survey.

The Dun & Bradstreet Composite Business Optimism Index stood at 79.9 for the first quarter of 2021, registering an increase of 26.8 per cent as compared to the year-ago quarter.

Five out of six optimism indices have registered an increase as compared to the first quarter of 2020.

The latest survey was carried out in December and covered 350 chief executive officers and managing directors.

"The survey data indicates a positive upturn in GDP growth during January-March 2021. The latest Index reflects the optimism generated from green shoots of and the deployment of COVID-19 vaccines from January 2021," said Dun & Bradstreet Global Chief Economist Arun Singh.

Singh further said the surge in optimism is also likely to have been driven by rising consumer demand, higher businesses transactions and normalisation of supply disruptions.

These factors have led to an increase in demand for passenger vehicles, two-wheelers and retail sales, all-time high GST revenue collection in December 2020, and the highest e-way bills collection (a receipt required for inter- and intra-state transport) in over two-and-a-half years, he said.

Dun & Bradstreet's commerce disruption tracker also shows less disruption to business activity, with data for December 4, 2020, indicating only 41 per cent of businesses were still disrupted, compared with 90 per cent in mid-July 2020.

"Furthermore, there has been increased funding in start-ups, the government has announced big-ticket infrastructure projects, and capital flows have surged, signaling the return of risk appetite of investors," Singh noted.

The survey further noted that 81 per cent of the respondents expect volume of sales to increase in the first quarter of 2021, compared with 69 per cent in the year-ago quarter. Moreover, around 71 per cent of the respondents expect an increase in net profits in Q1 2021, as compared to 66 per cent in Q1 2020.

As many as 78 per cent of the respondents expect their order book position to improve in Q1 2021, compared with 35 per cent in the year-ago period, according to the survey.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Tue, February 16 2021. 17:48 IST
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