It will be quarter of adjustment for firms: Aditya Birla group

It will be quarter of adjustment for firms: Aditya Birla group
Bengaluru, Nov 30 (PTI) The current quarter would be a period of adjustment for most companies in view of short term problems related to demonetisation of high value currency notes, a top official Aditya Birla Group said today.
“This (ongoing demonetisation process) is really a period of adjustment. We clearly see this quarter will be a quarter of adjustment for many companies because the cash flow still has not got back to normal,” the group’s Chief Executive (Financial Services) Ajay Srinivasan said.
He was talking to reporters here at the launch of the group’s standalone health insurance arm under the brand Aditya Birla Health Insurance (ABHICL), a joint venture between the Aditya Birla Group and MMI Holdings Ltd, a large and diversified financial services leader in South Africa.
Asked how long the companies would face difficulties, Srinivasan said the cash flow will get back to normalcy probably in the early part of next quarter.
From the short-term perspective, companies would face demonetisation-related problems, but from long-term perspective benefits, including lower interest and tax rates, would accrue, he said.
“From short-term perspective, we would be facing problems, but from long-term perspective, companies only will benefit.
There are several benefits that the economy will gain in the long-term from the move like this. Mobilisation of financial sector is one such thing which will gain,” he said.
“Lower tax rates, lower interest rates and greater tax coverage – these whole lot of initiatives could not have been possible without demonetisation move,” Srinivasan added.
On whether the company would be missing the bus to cash in on the opportunities thrown up by demonetisation since it’s payment bank services would be launched only next year, he said would not make any big difference.
“The change from cash to cashless society is going to take much longer time. So, we don’t think it is going to make big difference in terms of missing the bus or missing the size of the opportunity,” he said.
Despite being a late entrant, ABHICL aims to be the most preferred customer partner by 2020 with significant market share by making its products relevant to the young and health conscious, in addition to those dealing with chronic lifestyle conditions, its CEO Mayank Bathwal said. PTI BDN RA VS