ET POLL BSE-30 CEOs

CEOs feel things can only get better from here

Even as Mandate '09 looks likely to be a fractured one, the ruptures in the economy may have begun to heal. According to an ET poll of bulge-bracket CEOs, the slowdown might be on its last legs, offering the incoming govt a stable prop

AN OVERWHELMING majority of chief executives of India's largest companies is convinced that the economy can only get better from now, an exclusive ET poll shows, as the nation anticipates no such decisive verdict for any of the political parties aspiring to lead it.
    All but 10 out of the 31 CEOs polled by this paper believe that India has seen off the economic slowdown, raising hopes that the new government will inherit an economy that is on the mend. "I think the worst is behind us," said Kumar Mangalam Birla, chairman of the textiles-tocement conglomerate Aditya Birla Group.
    Twenty-nine CEOs of the 30 companies that make up the benchmark index, Sensex, of the Bombay Stock Exchange (BSE) as well as the heads of steel maker, SAIL, and the world's largest motorcycle company, Hero Honda, participated in the poll.
    The optimistic assessment comes despite a mixed bag of economic data: industrial output shrank by 2.3% in March to its worst level in more than 16 years, but ABN Amro Bank's Purchasing Managers' Index showed manufacturing grew in April for the first time in six months.
    "There are visible signs of a pickup in the manufacturing sector. With lower interest rates, strong rural demand and a normal monsoon projected, the slowdown could gradually be behind us, except for some export-intensive sectors," said SAIL chairman SK Roongta. 'Hard-hit industries need govt support'
THE second-fastest growing economy in the world, after China, posted three straight years of 9%-plus growth before being hit by a slowdown, early signs of which became visible by the second half of the fiscal that ended in March. Provisional estimates by government agencies put growth for 2008-09 at around 6.5%.
    Deepak Parekh, chairman of mortgage market leader HDFC, is confident that the economy can only grow in the current scenario, but he expects the government to help industries hit hardest by the slump.
    "There are certain industries doing well to extremely well. These include cement, finance, FMCG, telecom and banking. But there are also industries not doing too well like civil aviation, hospitality, retail and export sector, which the government should focus on," he said.
    Among those who saw little reason to be optimistic just yet was the head of state-owned oil firm ONGC. "I don't think that the worst is over. We can't completely delink ourselves from the global economy, as our economy is also dependent on exports," said RS Sharma.
    While most agreed that the economic drought is over, some see green shoots of recovery, while some others say the seeds have only just been planted.
    "There may still be some pain in store. Some pockets of the economy may have seen the worst behind them, but a few sectors will continue to see sluggish trends for the next four-to-five months," observed Pawan Munjal, MD & CEO of Hero Honda.
    Still others are hoping what they are seeing is not a mirage. "There are signs of recovery. Hope, it's real and sustained," said Infosys CEO Kris Gopalakrishnan.

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