Business prospects: Business Confidence Index jumps to 149.4 in April-June; NCAER survey Flags Optimism in Sales – Times of India

The business sentiment of India saw a sharp increase in the quarter of April-June, where the Business Confidence Index (BCI) rose to 149.4 in the previous quarter to 149.4, according to the last survey of the Business Apportations by the National Council of Applied Economic Research (NCAER).The index is based on four important components: expectations of the overall economic improvement in the coming six months, expected improvement in the financial positions of companies, the views on the current investment climate and whether the use of capacity is close to or higher, PTI reported. NCAER noted that more than 60% of respondents expressed positive views over all four parameters.“The share of positive reactions remained above 60% for each component and each component showed an improved trend compared to the previous quarter,” said the think tank.Optimism around production and domestic demand was particularly strong. About 78.7% of the companies said they expect production to rise in the coming six months, while 79.1% expected an increase in domestic turnover. The export sentiment was also strengthened, with 66.5% of the respondents expected an increase in outgoing shipments of finished goods.Companies were also more positive about their import requirements, with 54.3% expected an increase in the import of raw materials, an increase of 46.1% in the previous quarter – a sign of expected acceleration in domestic production activity.Almost 61% of the companies investigated the expected profit before taxes in the coming six months, which indicates continuous buoyancy in business activities.However, this optimism was not reflected in the prospects of the labor market. Hiring and wage expectations remained unchanged, which indicates a stagnation of the employment sentiment.“In moderation, companies were more optimistic over the next six months,” said NCAER professor Borali Bhandari, who led the survey.The survey, conducted in June, covered 479 companies in six large Indian cities.