Dun & Bradstreet Business Optimism decreased in Q4 2019

Business Optimism Index decreased by 19.5% (q-o-q)

Highlights

• Dun & Bradstreet Composite Business Optimism Index stands at 56.4 during Q4 2019, a decrease of 19.5% as compared to Q3 2019.
• Optimism for net profits stands at 59% - a decrease of 7 percentage points as compared to Q3 2019
• Optimism for new orders stands at 35% - a decrease of 22 percentage points as compared to Q3 2019
• Optimism for volume of sales stands at 61% - a decrease of 4 percentage points as compared to Q3 2019

Mumbai, November 07, 2019: The Dun & Bradstreet Composite Business Optimism Index stands at 56.4 during Q4 2019, a decrease of 19.5% as compared to Q3 2019. All the six optimism indices have registered a decrease as compared to Q3 2019.

The Dun & Bradstreet Business Optimism Index for Q4 2019 fell sharply with India Inc forecasting deteriorating growth. Optimism for new orders and sales prices are the lowest in nearly 18 years indicating the severity of the slowdown in demand. Multiple other demand indicators are also performing poorly: vehicle sales, domestic air passenger traffic, petroleum consumption and rural wages. Moreover, the floods in many states during the monsoon appears to have impacted rural demand which had been already subdued. Internationally, concerns on the trade war and protectionist policies are reflected in the indices.  The government has taken measures to counter these economic headwinds, but our respondents are not seeing signs of revival as yet. We expect further actions in the coming months” said Manish Sinha, Managing Director – India, Dun & Bradstreet.

Around 61% of the respondents expect volume of sales to increase in Q4 2019 compared to 65% in Q3 2019, a decrease of 4 percentage points. While around 32% expect it to remain unchanged, around 7% expect the volume of sales to decline.

59% of the respondents expect an increase in net profits in Q4 2019, compared to 66% in Q3 2019, a decrease of 7 percentage points. 31% expect net profits to remain unchanged, while 10% expect it to decrease.

90% of the respondents expect no change in the selling price of their products for Q4 2019. 7% of the respondents expect the selling price of their products to increase during Q4 2019, while 3% expect a decline.

35% of the respondents expect their order book position to improve in Q4 2019 compared to 57% in Q3 2019, a decrease of 22 percentage points. While 61% of the respondents expect new orders to remain unchanged, 4% anticipate new orders to decrease.

Around 34% of the respondents expect an increase in the size of their workforce employed during Q4 2019 compared to 40% in Q3 2019, a decrease of 6 percentage points. While around 60% anticipate no change in the number of employees, around 6% expect their workforce size to decline.

28% of the respondents expect their inventory level to increase during Q4 2019, as compared to 31% in Q3 2019. While 61% anticipate no change in inventory level, 11% expect inventory level to decline.