10 Best CFOs in India 2022

10 BEST CFOS

IN-FOUCS How Financial Institutions Can Shape The Country’s Economic Development?

Expert Talk Why is investing in Passive Fund a good approach?

by Krishna Kanhaiya from Mirae Asset Investment

MASANORI KATSURA

Vol 03 Issue 01-21 May 2022

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Editor Note

A Catalyst, a Strategist, a Steward and an Operator Human The Modern-Day CFO Definition The world is fast moving away from traditional methods to adopt new and agile ones. New way of functioning, newer roles and responsibility, integration of technology in daily functions and more. It not just defines the new-age executives but also the Chief Financial Officers (CFOs) who have fast moved being a business growth partner than just handling the finances and assets of the company, unlike the traditional ways.

Today’s CFO plays an important role in leading the organization from front, and hence they need to have the leadership traits.

When we spoke to several CFOs for this current edition, everyone second this thought in one voice. While some said that understanding the business inside out is as essential to make better business decisions, few emphasized on the importance of being tech-savvy to make data-driven decisions. All in all, it can be concluded that the new-age businesses bring new-age challenges and hence having both sides of the coin is equally essential – comprehending the business and being hands-inglove with technology.

In our current edition of TradeFlock, we bring to you the story of ‘10 Best CFOs in India – 2022’, we have brought their insights for our readers to read and execute. Every story in itself is a whole book of learning. From talking about their struggle, to success mantra, strategies, and even bringing their anecdotes of future plans, there is more to the discussion. Read their stories to get inspired.

Anamika Sahu

Consulting Editor-in-Chief

Vol 03 Issue 01-21 May 2022

Publisher Consulting Editor-In-Chief

Alok Dwivedi Anamika Sahu

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Vipin Kumar | Poonam Mittal

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10 Most Inspiring CIOs in India 2022 20 Most Inspiring Women Leaders in India 2022 10 Best CEOs in India 2022

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10 Best CPOs in India 2022

10 Best CFOs in India 2022 13 Anil Bothra

CFO, GTPL Hathway

17 Hemang Ladani

CFO, SHCIL Services

19 J K Parakh

President & CFO, Rama Phosphates

23 Neeraj Jain

Group CFO, Cosmo Films

27 Neeraj Mundhra CFO, Willowood

31 Nisha Mittal

CFO & Head of Exports, Ayurvet

35 Sachin Jain

CFO & Strategy Head, Shinhan Bank

39 Vikas Maheshwari CFO, KIMS

Editorial Column What Are The Priorities Of CFOs In 2022?

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COVER STORY 7

Expert Talk Why Is Investing In Passive Fund A Good Approach?

by Krishna Kanhaiya from Mirae Asset Investment

29

Effects Of Income Tax Changes On Economic Growth

by CA Harshil Goyal Co-Founder, Especia- Start-ups

37

in-Focus How CFOs Are Adapting Technical Advancement And What Side Effects Does It Have?

25

How Financial Institutions Can Shape The Country’s Economic Development?

34

10 Best CFOs in India 2022

Masanori Katsura CFO & Director

7

An Aficionado Creating the Next Line of Business-Ready Finance Leaders

Masanori Katsura Changing the visible things is easy; however, the challenge remains in changing the mindset and organization’s culture and behaviour which takes a long time

T

he mantra to a business’ success is understanding its pulse – whether it's people, operations, finance, business management or others. Making decisions being boxed inside a particular department will lead to losses because siloes are a big no in the business world. Especially for a finance head who needs to make decisions considering the function and functionalities of every department. Hence, we have success stories of CFOs who have a deep understanding of the business and regulatory affairs as well.

One such person bringing change to his organization is Masanori Katsura, the CFO of Bharat Certis AgriScience – a company that delivers sustainable agricultural solutions.

TradeFlock spoke with Masanori to discuss his role within the company, his plans for business expansion and his mission to create the next line of finance leaders within the company.

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Please tell us about yourself, your strategies and more.

Bharat Certis AgriScience is the secondary company of Mitsui & Co., and I come from the parent company. In my current role, I am responsible to transform the organization from a promoter-driven one to a real multinational company. Together with my colleagues, we have brought in a lot of changes in the PMI (post-merger integration). What I learned is that changing the visible things is easy, like introducing new regulations, internal changes and more; however, the challenge remains in changing the mindset and organization’s culture and behaviour which takes a long time.

We now need to influence and create as many leaders as possible with a new mindset possible that makes the whole organization’s behaviour or culture stick to a multinational level.

10 Best CFOs in India 2022

Masanori Katsura CFO & Director 10 Best CFOs in India 2022

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What according to you are the important traits of a CFO and how do you use those traits to succeed in the business?

I used to be a CEO before being the CFO. When I re-joined Mitsui & Co., one of my bosses taught me that using a CEO experience and being a CFO brings in a new view and a new way of thinking.

Sometimes, finance guys have their own priority and they put them before the company’s priority. We must understand that we need to increase business to expand and grow. Normally, the CFO who doesn’t have business experience doesn’t know the business priority. Unlike the olden times, we must learn to pass the information to management on a timely basis helping them to make business decisions quickly and right. And we use IT or machine technology a lot.

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Before Mitsui & Co. took over Bharat Certis AgriScience, people there used to passively use technologies like SAP. However, we changed the behaviour and today, it has become a prime mode of our work. We also use some apps and even encourage farmers to use them.

However, we are now trying to upgrade it to a new version, which is going to have more important information such as how to plant a particular crop and others. On the other hand, we also need to provide our field staff with updated information like when is the due date, or what is the contract amount while also tracking their activities in the rural areas. This helps us bring in more competencies.

On a different note, some finance experts working in the big firms usually ignore cashflow estimations. But I put a great emphasis on cashflow estimation and profit & loss statement. According to me, this is an important expertise every finance guy should possess. On the other hand, we should also be an expert in leveraging technology to make the most of our knowledge and work.

10 Best CFOs in India 2022

How did you take your last company from loss-making to profit-making?

When Mitsui & Co. took over AgriChemical Producers in the US, it suffered an annual loss of $8 billion. When I got the assignment, a saw several directors discussing just improving the production, however, what they needed was to discuss sales as well. I changed the direction with a focus on increasing sales, which will probably absorb the small problems.

We strengthened our sales and this fiscal year, they break even. They not only increased the turnover, but I even proposed to the parent company for equity swapping to lessen their burden. We just have to make timely decisions.

Sometimes, finance guys have their own priority and they put them before the company’s priority Unlike the olden times, we must learn to pass the information to management on a timely basis helping them to make business decisions quickly and right

10 Best CFOs in India 2022

How has been the development and growth of Bharat Certis AgriScience since Mitsui & Co. acquired it? As the CFO of the organization, what are some of your plans for the firm?

Last year, partly because of the pandemic, our business growth was slower than the average of the industry. So, to get back to track, we won several projects and onboarded good customers. We continue to add more clients.

We also introduced some proprietary products from Japan.

We are encouraging our team members to strengthen their communication and teamwork. On top, we are trying to have an alliance within and outside of Mitsui Group. We recently made investments into a company, and we keep introducing our customers to each other which leads to increased business.

Any expansion plans for the organization?

We are exploring every growth possibility, including global expansion.

Mitsui has a different sister company in a similar industry, i.e., agrochemical and we are trying to merge both entities.

Further acquisitions are also under plan.

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10 Best CFOs in India 2022

T

o excel in having not good but great finance books, an organization needs CFO who understands the business inside-out. This will allow them to make powerful decisions in every sphere of business. However, in these trying times, a CFO has larger roles than ever to take care of. The pandemic has hit several industries harder, crushing their finance. On the other hand, it pushed businesses to go complete digital. In fact, there were the testing times for CFOs, who had to look into multiple matters at a single time – managing the books, expanding the business, continuing business operations, managing supply chain, ensuring the team stays collaborative and get all the support they need in such times, and above all, global expansion.

As businesses today have global operations, CFOs also have to ensure that their firm comply to every country’s rule and policy. There are more to their books of challenges. Discussing these and many more is current edition of TradeFlock.

The edition ‘10 Best CFOs in India – 2022’ explore interaction with some of the best CFOs from various industries to know their challenges, strategies, plans and investment opportunities.

These CFOs believe in not just creating a tech-savvy ecosystem but also enabling a better communication to ensure that every employee is self-motivated to make proper decisions.

Their quest to transform and grow their organization is unparalleled. Read their story in this edition.

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10 Best CFOs in India 2022

NAME

DESIGNATION

COMPANY

Anil Bothra

CFO

GTPL Hathway

Hemang Ladani

CFO

SHCIL Services

J K Parakh

President & CFO

Rama Phosphates

Masanori Katsura

CFO & Director

Bharat Certis AgriScience

Neeraj Jain

Group CFO

Cosmo Films

Neeraj Mundhra

CFO

Willowood

Nisha Mittal

CFO & Head of Exports

Ayurvet

Sachin Jain

CFO & Strategy Head

Shinhan Bank

Vikas Maheshwari

CFO

Krishna Institute of Medical Sciences (KIMS) Hyderabad - India

Vinod Verma

CFO

Wanbury

10 Best CFOs in India 2022

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Striking the Right Balance Between Rigor & Agility

Anil Bothra

F

inance is among the most critical business functions. In fact, its importance can be understood with the role that a CFO today plays – they have found a place in the board meetings contributing to important business decisions. On the other hand, the integration of technology with utmost security features is another task at hand for them. The work becomes more critical in the industry where the regulatory landscape changes at light speed. A CFO needs to be on his toes to ensure compliance obligations across multiple jurisdictions, pre-empt the regulators and convert them into opportunities.

TradeFlock spoke with Anil Bothra, CFO, GTPL Hathway Limited to know more about his role within the organization. Anil has been steering the company’s financial wheels since 2019 and has taken it from good to great.

How do you deal with one of the most critical success factors of any organization – finance management?

At GTPL Hathway, financial management is part of the key processes within the business and be included in robust planning and budgeting, cash flow management, cost optimization, meeting tax deadlines, control over stock, getting funding at right time with the right cost, leveraging on technology, awareness of finance for non-finance etc. As a result, GTPL Hathway is enjoying a good credit rating, debt-free status, number one MSO in India and lowest ever finance cost in the M&E industry.

The ongoing regulatory landscape in the industry is changing very fast, especially in the last 4-5 years. At GTPL Hathway, I have developed a culture of keeping up to date with the latest regulatory update, retuning our processes for compliance obligations across multiple jurisdictions, pre-empt the regulators and converting them into opportunities.

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Anil Bothra

CFO, GTPL Hathway

What technologies are you currently leveraging to link efficiency and profitability?

While the pandemic’s impact on the individual industry is unique, it becomes imperative to put renewed focus on capital allocation. RR Jhunjhunwala (Head-Group Treasury) and I feel that business has to look beyond the bottom line and take a more holistic view of capital allocation, incorporate effective data management and analysis, and focus on building trust with stakeholders through effective communications and GTPL is committed to this philosophy. In the current business environment, in my view, striking the right balance between rigour and agility will enable companies to achieve their longterm strategy and value creation goals while navigating short-term disruptions.

At GTPL Hathway, we are spending ~ Rs.4500 million per annum as CAPEX from internal accruals, this capital allocation defines the future of the business considering the capabilities and assets are needed to get next level of growth, aligning the capital allocation process with the

10 Best CFOs in India 2022

strategy with a rigorously review the portfolio for opportunities to divest to fund reinvestment in the core business by using a balanced scorecard and assign weight to qualitative KPIs that create long term value creation strategy for GTPL Hathway. As a matter of strategy, we reward shareholders with good dividends as well.

What strategies have you planned for this financial year for GTPL Hathway and how do you plan at making it stronger?

2021 presents an opportunity to turn hardearned lessons from the COVID-19 pandemic into an enduring exercise in linking strategy to value. At GTPL Hathway, we are actively looking for synergy benefits by leveraging M&A strategies, cost optimization, investing in new products/ technologies and business partnerships.

We are in the middle of building a more robust finance team and equipping them with the latest ERP, technology support enabling them to work for shorter reporting cycles and setting benchmarks in corporate governance with the agile working environment.

How are you introducing yourself to new technologies and using automation to implement your strategic vision?

GTPL is focused to provide end-to-end integrated solutions enabling and empowering its employees to focus on the exceptions and provide analytical insight in each of the key business processes.

GTPL’s finance function is indeed a two-way free-flow communication stream promoting and encouraging innovations, irrespective of its cadre and vintage. Each senior team member plays a key and primary role in financial disruptions, critically reviewing each innovation brought to the table and also evaluating this on a 360-degree basis.

With a vision to create an inclusive and holistic financial process across the organization and group companies, I am creating an ecosystem where every team member of the finance function can actively contribute to the transformation for their respective areas to the business and become a technology transfer agent.

I am focussing on converting complex problems into simplistic implementable solutions through a participative model of group working, which has proved to bring out the best of the minds together not only to deliver the out-ofthe-box solutions but also simultaneously to bring life to these solutions.

RR Jhunjhunwala

HOD Treasury, GTPL Group

10 Best CFOs in India 2022

Under my Finance leadership at GTPL, we collectively witnessed the following digital implementation that includes Common Accounting Code across the entire Group; Better and stringent controls in Regulatory and Statutory Framework; Transparency in the Invoice booking to Payment Processing; Zero Netdebt status; Cost optimizations for borrowings; Synergy across group companies; Knowledge sharing among team member through digital mode; Internal Restructuring of the Group with Merger, Demerger & Dissolutions of JVs & Subsidiaries for better Financial Management; Winner for Finance Transformation Initiative 2020 at 7th Finance transformation Asia summit and Award 2020; and Excellence in Finance Transformation award at The Financial Leadership Awards 2021.

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Hemang Ladani Making a Mark in the Investment Sector

C

hange is the only constant and one who doesn’t change, perish with time.

Today’s business world is evolving fast and so are the roles of the executives driving the company from the front. Following this suite is the CFO role that has mutated from being one handling just the accounts and finance to taking technology and business decisions sitting on the driver seat along with other key members.

As per Hemang Ladani, CFO of SHCIL Services Ltd., the strong understanding of the business is critical; that is what will help you take the best financial decisions.

TradeFlock spoke to Hemang to discuss about his role as the CFO of a SEBI registered corporate stockbroker firm, and how he is driving the innovation within the company.

Could you highlight your role within the organisation?

SHCIL Services is a government company under the group of Stock Holding Corporations, which is a pioneer in the DEMAT services in India. SHCIL Services caters to retail clients, institutional clients (domestic as well as international) and corporate clients with options to invest through our trading platform in equities, mutual funds, commodities and any other

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Hemang Ladani

CFO, SHCIL Services debt & treasuries issued by the government of India. The company facilitates through digital apart from physical mode of operations.

As a CFO, I am in charge of company’s financial operation which includes internal and external financial reporting, steering the company’s assets and managing the cash flow. In addition to traditional role of CFO, my role is more forward looking at extending to formulation of business strategies and growth plans for short and long term. Being a core member, I am instrumental in managing and driving digital products and technology.

In today’s world, CFO is expected to be an extended arm of CEO and required to put our self into techno-commercial bucket. I can say that my role within SHCIL Services is expanding continuously.

Your three major strategies within the organisation and how you are driving the business and the finance of the organization?

Our first strategy is optimising the use of finance by offering products with tight monitoring tools. We have added additional products under this umbrella. I started this activity last year and least to say, our test is successful. Industry revolution 4.0 opened

10 Best CFOs in India 2022

gate for data and AI driven business, and we offer edge cutting services to our clients apart from robust technology platform.

India is a young country, and we now have a large portion of young investors, who are exploring the world of investment as their second channel of income. For them, we have gone digital in a big way providing them the best of digital investment experience with security. It’s like a DIY tool kit which guides them throughout the journey, right from the client registration and thereafter the movement of the funds and training activity, investment activity and thereafter. Right now we are working on automating the entire process based on the AI platform, making it more robust.

Since the last couple of years, our Ministry of Finance is promoting financial inclusion and financial literacy for every Indian citizen, while emphasizing on digitisation. We want to be active partner in this journey. We are targeting tier II and III cities along with rural areas to expand our reach through our digital platform to ensure financial inclusion for all. We also have physical presence across the nation, which makes our customers experience a better service.

What is the growth of the company in the recent past and your prediction?

The Covid-19 Pandemic encouraged us to use digital platforms and gave an opportunity to create second source of income from the stock market at every level. We have moved one step further by allowing to access our services from multiple platforms, which helps in generate 50% growth in YoY basis in the last two years in the interest of Indian citizen in the investment in equity directly or indirectly.

Apart from the domestic inflow, India can attract $120 billion FDI annually by 2025.

The business and market outlook of India is strongly positive. We will be part of this growth story by expanding the channel strategically and expected to yield 30% growth on the top line.

10 Best CFOs in India 2022

What is your biggest challenge currently?

Stock market was always a point of attraction for ages and evolved further.

These brings regulatory reform over the period, and the recent evolution in the technology era where it brought in the transparent system, the regulators are changing their policies and regulations to safeguard the interest of the investors. As they are constantly evolving with dynamic changes, we also need keep the same pace to educate the clients besides the changes in the internal system.

What innovations are currently underway within the company?

The innovation is two pronged – employee facing and customer facing. I developed an energetic and dynamic work culture where ideas started generating irrespective of the grade of the employees. The one brilliant idea is recognised which improves the profitability of the company. In fact, I see many heads shaking to come up with ideas than one, which is helping us innovate in our methods.

Also, I have introduced overall techno ecosystem tie-up, where every area of activities is being aligned with data, which helps to improves overall profitability of the organisation. This resulted in the growth of the firm by acquiring customer through word-of-mouth publicity.

What is your future plan?

We being a partner to the financial inclusion journey, we have very aggressive plans to reach out to potential customers through collaboration and tie-up at multiple levels.

We need to have future plans not only on commercial line but also toward building financially literate society irrespective of the geography in India.

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A Foresighted Finance Expert Taking Risks by its Horns

J K Parakh Motto – Quality commitments, safety and safe environment, sustainable growth through brownfield and greenfield expansion in related field is our main motto.

Thrust on technology, automation viz. SAP implementation and professional management Our company is one of rare example in India, to become debt-free after negative net worth

F

rom being the finance manager of a company to now leading it as the President and CFO, J K Parakh has come a long way in his two decades long journey with Rama Phosphates. A Chartered Accountant with Company Secretary qualification, Parakh has held several roles within the organization, from concentrating on BIFR related activities and successful exit to now overseeing the entire activities right from key raw material sourcing, plant operations, manpower, finance, marketing, Govt. liaison, strategic planning, expansion, acquisition, diversification, automation, to R&D, etc. Today, he is all geared up to make the organization a Rs.1000 crore entity and diversify the business into different segments. His finance acumen is playing an instrumental role in realizing this dream.

TradeFlock spoke with Parakh to know more about his journey with Rama Phosphates and how he plans to take the company forward in the coming times.

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J K Parakh

President & CFO, Rama Phosphates

What were some of the major challenges you faced with Rama Phosphates? How did you mitigated them to strengthen the company’s financial status?

Two decades ago, when I joined the company, its financial condition was in precarious position since restructuring activities were set in subsequent to reference under Hon. BIFR due to erosion of net worth. It was an arduous task to meticulously pick the thread and to wriggle out from the clutches. During the trying period, at one time we almost lost the hope of revival as the disposal of one of our units was mooted by the authorities. Board of directors then took a path-breaking decision and opted backseat in management by allowing the team of professionals to take bold steps as per the need. Numerous rounds of meetings with the consortium members bank took place

10 Best CFOs in India 2022

including financial institutions and various stipulations and conditions were imposed on the company including appointment of director by Hon. BIFR to monitor activities.

Meticulous planning for plants’ operation on continuous basis by ensuring timely availability of raw materials and finance management with better negotiation with suppliers on credit terms and prices, centralized working capital management and procurement, cost-cutting measures including freeze on CAPEX were all the measures taken during the course. Over and above, thrust was given on preparation of SOP for all major activities having financial implications and strict implementation with personal follow-up. Building trust with all stakeholders/suppliers by fulfilling commitments under any circumstances even when bankers took backseat. Putting major thrust on quality and branding with efforts for ghar-wapasi of major customers by giving them special terms and customized services by honouring commitments given by employee.

The path of recovery was quite strenuous eventually. Our all-out efforts bore fruits as the market cap has increased steeply from Rs.2.00 crore to Rs.900 crore plus in two decades. Today, we are market leader in Maharashtra and also a dominant player in M.P., Rajasthan, Haryana and Karnataka in fertilizers. Over a period, we have diversified into chemicals, micronutrients, LABSA, edible oil etc. and made sustainable business module with backward & forward integration.

However, now we can proudly say that our company is one of rare examples in India to become debt-free after negative net worth.

The manufacturing industry is currently rife with change, specifically when it comes to compliance management. How do you upkeep with the everchanging regulations?

Yes, compliances are need of the hour and no company can survive in long term without putting thrust on compliances part. Safety and safe environment is our main motto. Any lacuna or dereliction is not acceptable on zero tolerance and zero-defect basis. Every norm, directions

10 Best CFOs in India 2022

of any authorities are strictly complied with.

Now this has become a matter of routine for our company. Our industry association is doing a commendable job in keeping us abreast with latest requirements whilst my frequent interaction with peers in our industry also helps in exchanging thoughts. Moreover, recently we have started availing services of a reputed consultancy firm, which is wholesome in ensuring compliances in all respects. With this, we would be able to play safe at all times.

No company can survive in long time by ignoring compliance’s part. We have set up compliances team, which take care of new developments and challenges and also provide solutions.

What is the roadmap ahead and how are you gearing up for the same?

I always tell my team to focus on achieving Rs.1000 crore turnover, which is about to be surpassed. This mission was set about three years earlier when we were staggering between Rs.500 to Rs.600 crores. My energy is now focused on commissioning of new plant in Maharashtra state and see that the product comes out by March-2023. I have set up a core team for each assignment with direct reporting on day-to-day activities.

Recently, we acquired SSP Fertilizer manufacturing plant on a long-term lease basis with installed capacity of 66000 MT. Diversification into Chemicals business in a bigger manner. This is quite essential to mitigate risks and considering risk-reward ratio, we are focusing on diversification and valueadded products mix. For instance, from SSP fertilizers, we fanned our wings to Chemicals, Labsa, Edible Oil, Micronutrients, Phospho Gypsum, Solar power, value-added fertilizers.

We have 1500 plus loyal dealers across India, and we want to market various fertilizers.

Quality commitments, safety and safe environment, sustainable growth through brownfield and greenfield expansion in related field is our main motto. We will be true to our motto while giving thrust on technology, automation viz. SAP implementation and professional management.

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Editorial Column Talent, Growth And Performance

Are The Priorities Of The CFO In The Year 2022 And Beyond

O

ver the past three years, the role of chief financial officers has changed both in terms of position in their company and the priorities they need to work upon. Different geographies, economies and different stages of management across the countries and companies determine the priorities of financial executives.

As we are entering into Q2 or 2022, there are three key areas that every CFO should prioritise to stay ahead in the evolving competitive landscape.

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10 Best CFOs in India 2022

Good talent is rare hard to come and hard to keep!

CFOs need to be ready to tackle the “great resignation” that is expected to get pace in the coming months (most probably by the third quarter). The reality that financial experts have been long trying to hide is the exodus of segmenting in workforces has resulted in staff shortage and is now impacting the companies (culture and bottom line). Pulse Survey states that a vast majority of CFOs have turned their focus on hiring in retaining rather than evaluating pricing strategy and other responsibilities that they were previously handling to streamline the finances.

The current unemployment rate, declined below 4%, indicating the country gradually reaching its “Full Employment” mark which means there is no way and scope to cope with the talent shortage.

CFOs need to act fast to overcome the obvious complexities on the head by finding the right talent, effectively onboarding new employees, and proactively investing in a-star employees to successfully thrive in a hybrid environment.

While talent acquisition and retention are the utmost priority of the CFOs, they should start taking up employee listening surveys, openly talk about the company culture and provide transparency in feedback. It will further aid the leadership to solidify the people management and resource development to improve the future.

While businesses are waiting to call the pandemic a long gone past, the effects still manifest in business and other sectors. The present scenario demands the CFOs to create an efficient financial situation that focuses on increasing the cash flow conditions.

In order to achieve the desired outcomes, CFOs must set their priorities for the coming year and leverage digitalisation. The definition of "Normal" has changed in past years, and people are already adapting to the "New Normal". CFOs are considering focusing more on accelerating the work in the coming months. Studies suggest that in the coming years, business strategies will change and adapt around digitalisation in order to leverage augmented outcomes.

10 Best CFOs in India 2022

Collaboration with C-suite executives will be continued In a post-pandemic workplace, a strong CFO-CIO relationship is and will continue to be key to facilitating organisational growth. The past couple of years has seen the emergence of the “Strategic CFO”.

Open and frequent communication focused on strategic problem-solving was an essential component of many organisations’ navigation of the pandemic and it remains a vital part of planning for post-pandemic success.

As the agents of efficiency and agility, CFOs and CIOs, in partnership with CEOs and the rest of the senior team, bring the most impact to their organisations when aligned and sharing a leadership vision.

From improving finance processes to driving employee engagement, a strong relationship between the CFO and the CIO generates value within an organisation, enabling operational pain points to be effectively resolved, and value-added processes, platforms and frameworks to be implemented.

Identifying other plans of CFOs in 2022 involves reports that showcase the plans of allocating and relocating the capital in new business. Around 67% CFOs address that their organisation is planning to pursue joint venture and M & A opportunities.

Indicating an expansion in many products and services until the end of the year.

Progressing towards the year 2023, the plan of CFOs is to procure new debts while reducing a significant proportion of bonds and debts that are ideal.

CFOs are effectively working to onboard new talents and develop an open communication culture of the organisation to accelerate growth and develop better resources. After completing the first quarter of 2022, CFOs are critically positioned to improve the financial process of the organisation.

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T

Neeraj Jain

The Finance Wizard Paving Unprecedented Growth Path for global Flexible Packaging leader – Cosmo Films

he global flexible packaging market is expected to value $325.6 billion by 2030, growing at a CAGR of 6.2%, while the global sustainable packaging market is expected to grow at a CAGR of 7.55% during 2020-2027. Indeed, the industry is showing a huge potential.

However, not many firms are able to lead the path successfully. But for Cosmo Films, Neeraj Jain (Group CFO) is paving a greener path leveraging his 17 years of experience working with large manufacturers and service industries. He has implemented strong financial decisions within the organization that is enabling the company to not just stand strong in today’s volatile market but also designing a brighter future with sustainable packaging being at the core.

TradeFlock spoke to Neeraj to understand his strategies and how he is devising financial plans to ensure strong books.

What investment plans you have scripted for Cosmo Films as its CFO? The flexible packaging industry is growing fast and the last decade observation puts this at 10-12%. This growth rate is above the FMCG industry as several new applications are shifting from other form of packaging to flexible packaging, although 70% of the flexible packaging products go to FMCG. Looking at this strong demand, we have planned for capacity expansion by about 60% of existing capacity which is expected to commence commercial production in next three years in different phases. This capacity expansion includes BOPP, BoPET and CPP capacities.

Neeraj Jain Group CFO, Cosmo Films 23

The move towards CPP capacity enhancement shall facilitate sustainability and ESG goals as CPP film along with BOPP film offers a recyclable structure. While BOPP is our bread and butter, BoPET is a new complimentary segment which will enhance our product portfolio and shall facilitate growth of specialized value-add films.

10 Best CFOs in India 2022

How are you devising your financial investments?

Our financial investments are largely driven by two factors. First, investing in the segment that is experiencing a huge demand, and second, our intention to come out of commoditization cycle to a large extent.

Accordingly, we planned our investments to be focused more on the specialized value-add films which have substantially better and stable margins. .

As I indicated earlier, CPP film is going to be the futuristic film because it has the capability to provide the mono layer structure based on the polypropylene along BOPP, which makes it completely recyclable films.

With global FMCG brands moving towards sustainability, it is an opportunity for us to provide the right kind of the film for recycling.

Hence, we intend to lead the sustainability flexible packaging from India.

How do you use technology to ensure faster and safer financial health of the organization?

Cosmo Films is a firm believer in technology. We lead the flexible packaging industry in India on the technology front.

We have the most advanced ERP, SAP HANA in place with respect to managing not only the accounts but also thekey business processes of the company, which ultimately helps in facilitating better services to the customers, and to be fair to all our stakeholders.

Having said so, we have also implemented a very robust CRM platform. Our sales team interact very frequently with the customer base. With this CRM, just at the click of a button, customers can get their account statement online. It reduces the confusion in the system and brings a strong business process in place. We are in the process of automating many of our process workflows and going paperless. While we rely heavily on technology, security definitely is the top priority for us. We have firewalls in place.

10 Best CFOs in India 2022

Is there any kind of critical element that you consider when evaluating or making the investments?

For us, there are two important criteria – ROCE (return on capital employed) and payback period.

We are strongly considering what kind of ROCE our new investments will generate. For instance, if our existing business does a ROCE of 20%, our incremental investment should do better ROCE to add value to the shareholders and will ultimately enhance company’s overall ROCE. On the other hand, we constantly evaluate our payback period. The lower the payback period for the investment, it’s a better proposition. .

Today's CFO has a bigger role when it comes to playing within the organization. How do you see this role transforming and how are you preparing yourself for this future?

You rightly picked that the role is ever evolving and is fairly demanding from many aspects. As a CFO, I focus more on the use of technology as companies using highest standard of technology will be doing much better, compared to non technology savvy companies.

Second is to maximize the shareholders’ value.

Despite the kind of investments you make, the Return on Investment you have, it is important to maximize shareholders return. Hence we employ our actions and capital accordingly.

Having said so, managing uncertainties is also very critical. Nowadays, the environment is too volatile globally. This calls for immediate action.

To judge what kinds of actions you need to take to get those implemented and evaluating them periodically are key. This will help change our strategies wherever required. For an instance, the foreign exchange. The kind of fluctuations that happen every moment in the exchange rates, it is a challenge for companies that are into export and import. To counter it, we have implemented FOREX management policy, and we don't deviate from it.

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in-Focus How CFOs Are Adapting Technical Advancement And What Side Effects Does It Have?

C

ovid made its first appearance in 2019, while all other areas were barricaded by the pandemic, finance and technology emerged as a ray of hope. When the pandemic raised uncertainty, CFOs turned over to shortterm plans. Focusing on nimble technology, several CFOs came forward with pressing issues due to technological advancements.

Indeed, adapting to technological advancement is difficult for everyone, including CFOs. While Chief Financial Officers of companies like SaaSgave statements addressing the efficiency that technology brings to the table, they also addressed that adapting to it at the same speed as technology is evolving, is quite a challenge.

Even simple tasks like sending the mail are now seen as burdens on the financial teams.

It is true that technology has provided the right set of tools, but these tools are everevolving. With every new update, the difficulty in adapting it to the system increases and thereby managing the team morale is also difficult. Gone are the days when CFOs were limited to crunching numbers, with digitalization their tasks are now more complex. Regardless of the organisation, catching up with the speed of technological development is evolving the role of CFOs. Their role is now centred to lead the team

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towards a higher level of technical expertise while also working closely with the IT sector.

Apart from analysing the “numbers”, CFOs now have to adhere to business intelligence as well. Catching up the real-time data and most importantly keeping the team in sync throws a major challenge. Another challenge that technology brings is finding new technologies to keep the market value and brand image of the company.

While there are reasons to address technology as a challenge, it also has a silver lining. Process automation, data analysis and tracking of the finances are some of the brownie points. On the other hand, technological advancement is a major challenge, it also puts forward side effects Frauds and Cyber Security.

While it is believed that technology brings tracking options, identity theft and phishing are two hand-in-hand cons of digitalisation.

It is pretty hard to find who is sitting behind the screen and what danger it poses. With involvement in the role and its challenges, it is mandated for CFOs and their teams to crawl their attention on fraud, cyber misuse, and data privacy protection. They need to stay ahead to eliminate any uncertainty.

10 Best CFOs in India 2022

The New Age CFO Transforming Agrochemical Business in India

Neeraj Mundhra A

s the businesses go overseas and become a true multinational, the role of a CFO is also changing dynamically. Unlike the initial days of a CFO where they just had the responsibility of ensuring good books, today their purview has expanded beyond it. From looking after business expansion to supply chain, merger and acquisition to even winning employee confidence, a CFO has many things on his plate.

Especially in a very sensitive business sector like agrochemical where a larger part of the raw materials is imported from different countries, making a stronghold of the market with the most tailored solution is the key. Neeraj Mundhra has been making such big strides within the industry through his exceptional decision-making power leveraging his deep business understanding. As the CFO of Willowood, a producer and distributor of crop protection chemicals and a trusted name in the agrochemical industry, he has been with the company for over 12 years now and is striving toward making it a self-dependent organization.

TradeFlock interacted with Neeraj to know more about his journey within the organization and how is he truly leveraging the growing agrochemical demand within the country to make Willowood a reliable name.

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Neeraj Mundhra CFO, Willowood

Can you tell us about your educational and professional background?

I am an alumnus of IIM-C, and have done my PGDM from SIBAR, Pune (Finance & IB), and PGDFT from Pune University. B.Com (H). I started my career with Willowood Group 12 years ago as their Account Manager and now lead the organization as CFO. Before joining Willowood, I worked with Motilal Oswal as a BDM for two years & one year with HDFC AMC.

Tell us about your unique skills that differentiate you from your peers in the industry?

I am part of the growth of the company from $10 million to $300 million. Several efforts and strategies led to such growth. So most of the times I have solution to the problem and can offer to company pain points.

As I mentioned earlier, I started as an account manager and today lead the organization as their CFO. Apart from this I also involved in International Business (Import - Export), IT, supply chain, and domestic & global M&A

10 Best CFOs in India 2022

sections of the company, which gives me an added advantage to understand the entire operation cycle other than finance. This even help me to make decisions with broad prospects.

It is time for Indian agrochemical manufacturers to shift focus ahead of generics and start investing in R&D. How are you gearing up for this revolution?

Yes, we recently added a new vertical of R&D centre. This is the biggest GLP lab in SouthEast Asia. The industry is leaning towards combination products instead of solo ones.

Rather than creating chemicals to deal with individual problems, such as a particular type of weed, combination products are broad-spectrum and can treat different types of pests, diseases and several weeds at the same time.

Please elaborate on your cooperation with China and how has it been affected by the regulatory changes over the years? How are you planning to eliminate your dependency on Chinese imports?

Currently, we are procuring 70% of our raw materials from China. The country’s chemical industry is built up over the past two decades and had prioritized growth over environmental quality. However, the new environmental regulations are having a huge impact on the agrochemicals & intermediates. At the same time, the Indian government is implementing policies that will make the environment easier for Indian companies to set up new plants in India. For reducing the dependency on China, we are setting up an AI manufacturing plant in India, which shall be completed by July'22.

10 Best CFOs in India 2022

The role of the CFO has evolved to include casting a protective eye over security and all critical issues with high stakes attached.

How do you manage all these?

Our market is very volatile and competitive and hence we need to understand how to keep creating and capturing additional value for our products and services. We also need to know what alterations we need to make to our operational and business models to hedge against currency risks, climate change, evolving regulatory requirements, and endmarket disruptions.

For managing these issues, we continuously increase our registration base and extend our geographical presence. Also, we strictly follow our hedging policies to manage currency risk.

What would be your new focus areas in the coming times, looking at this transformation?

A future that is focused on sustainability, doing more with less, and digital technologies.

These will help us have a long and powerful journey within the industry. We are focusing on innovation and R&D to develop and commercialise our new products.

What are some of your learnings that you would like to share with the aspiring CFOs? In my view, “You need a thirst for knowledge.

Not in an academic sense, but to always have a finger on the pulse of the business operationally and being relentless on finding ways to do things better and provide better insight.”

That thirst for knowledge is reflected in what we see as the difference between a CFO and other finance positions. The other person focuses on what happened: revenue, bookings, cash burn, etc. CFOs do that too, but then they also tell why things happened and what we’re going to do about it. I always emphasise and value people who focus on ‘why’.

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Expert Talk

Why is investing in Passive Fund a good approach?

O

Krishna Kanhaiya

CFO, Mirae Asset Investment Managers (India) Pvt. Ltd.

ver the past decade, there has been a substantial shift from active to passive investment strategies in the investment industry. With markets getting efficient over time, active funds find it difficult to beat the benchmark.

The latest SPIVA scorecard (S&P Indices versus active funds) confirms this trend. From January 2010 to December 2021, 67.61% of large-cap funds have underperformed their benchmark (S&P BSE 100 Index). The underperformance trend continues even in the midcap and small-cap categories, where 56.06% of active mid and small-cap funds have underperformed the benchmark (S&P BSE 400 MidSmallCap index).

(Source: S&P Indices SPIVA Report India 2021)

Fund managers can invest in low-cost passive products such as ETFs and index funds to mitigate the risk of active funds underperforming the benchmark. Passive strategies have emerged as a strong investment alternative and can prove to be an attractive vehicle to generate returns without risking underperformance. This strategy utilises rule-based investing to track an index by holding all of its constituent assets in the same weightage with an aim to generate similar returns. Passive funds also provide investors with a wide array of investment options, ranging from investing in a portfolio tracking a market segment like mid-cap or a theme like manufacturing or a strategy like low volatility to asset class like silver or a specific country or a group of countries. Thus, by implementing rule-based investing, passive funds can provide a very focused approach to tracking and generating returns based on the desired investment objective.

Another big advantage of investing in passive funds is low cost. For example, the cheapest NIFTY 50 ETFs are available at just a .05% expense ratio. The Expense ratios of passive funds can be 1.5% to 2% lower than actively managed diversified equity funds (Regular plan). Over long investment tenures, a 1.5% to 2% difference in annualised returns can result in substantially higher absolute returns due to the compounding effect. Let’s say you invested a ₹1,00,000 lump sum into a passive fund paying a total of 0.1% a year. Assuming the fund generated 10% growth every year, your initial investment would be worth ₹2,57,026 after 10 years. However, the same amount invested in an actively managed fund with let’s say a 2.00% annual charge would grow to just ₹2,15,892 over the same period once fees have been deducted. The difference of almost ₹41,133 is just a result of the fees differential charged by both the funds.

(Source: ACE MF; Data as of Mar 31, 2022)

With active fund managers finding it increasingly difficult to outperform the benchmark, that too on a consistent basis, the passive funds like the ETF, make a compelling reason to become a part of an investor portfolio. This will not only reduce the fund manager's risk but also lower the overall cost of the portfolio.

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10 Best CFOs in India 2022

10 Best CFOs in India 2022

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A Strategic Leader Central to Critical Finance Decision Making & Planning

Nisha Mittal Nisha Mittal

CFO & Head of Exports, Ayurvet

T

he recent uncertain times have put immense emphasis on the role of a CFO, integrating them as a business growth partner rather than someone just managing the financials. To reflect on the changing role of CFOs and how important technology is in ensuring their supremacy, TradeFlock interviewed Nisha Mittal, CFO, Ayurvet.

Nisha believes that companies that leverage data strategically will be tomorrow’s market leaders.

She has been instrumental in implementing various technologies within the company to ensure data-driven decision making that drives organization towards a strengthened finance future.

You started your career with Amul. How has been your journey and learning within the organization?

Amul is close to my heart as it is where I started my career. Being India’s largest dairy cooperative society, transactions in Amul are voluminous and of high frequency. The company’s initiative on TQM (Total Quality Management) helped to create modules to actively handle operations with efficiency and zero defect.

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I was very enthusiastic and instrumental in the implementation of techniques of TQM, be it PDCA (Plan, Do, Check and Act), 5-S concept of housekeeping (in Japanese, the five S are Seiri, Seiton, Seiso, Seiketsu, and Shitsuke).

In English, the five S are translated to Sort, Set in Order, Shine, Standardize, and Sustain.

Others were Kaizens (continuous improvement or change for the better), Quality Circles (crossfunctional teams responsible for addressing immediate process issues), Hoshin Kanri Meetings (lean management method for ensuring that a company's strategy gets executed across the hierarchy), Information Audits or others.

The pandemic was a tough time. How did you manage the finances of the organization?

During the pandemic, there were questions in everyone’s mind including business continuity, operations, material procurement, labour availability, manufacturing processes, supply chain, sales, customer connect and circulation of money.

During the first lockdown, with a cascading drop in demand and revenues, the immediate challenge was the protection of cash reserves.

10 Best CFOs in India 2022

We took appropriate measures to reduce the sales receivable cycles and minimize various spending in the company. Also, we went digital to generate and make data available to all concerned to take timely decisions, banking, compliance management and Business Intelligence, while activating customer care portal.

However, the second pandemic wave hit us and our rural dealer network badly. Hence, we had to create multi-action plans keeping in mind different scenarios that may occur in future.

This ensured the company's preparation for varied possibilities and forward-looking risk management for the VUCA situation.

Technology has been an enable and a saviour in these tough times. How do you leverage it?

The three key technologies leading the transformation of the company to be more agile, dynamic and successful are automation, data visualization and analytics. While automation helps streamline processes and data visualization provides real-time data, data analytics helps to make informed, tactical decisions and identify growth opportunities. To ensure robust customer connect, CRM modules have been activated with the help of technology while we have made online selling portals operational.

I believe the digital age has its own challenges.

Businesses deal with important data and sensitive information about customers and financial transactions. Therefore, it becomes inevitable to adopt technologies and frameworks that not only keep data secure but also help businesses comply with regulatory standards.

What financial initiatives have you introduced at Ayurvet?

There are many, but I would like to highlight the ones that brought me utmost satisfaction.

The transformation of Ayurvet from a debt company to a cash surplus entity. To any organization, cash flow is equivalent to blood flow in the body. For any business to become

10 Best CFOs in India 2022

financially strong, it is important to have a healthy cash flow. At Ayurvet, we introduced various initiatives akin to introducing robust credit policy, strengthening KYC norms, involving all stakeholders in the process, automating certain processes, and changing the mindset of sales personnel while making them aware of the significance of ‘fast rotation of business’ through training programmes, and showcasing them the benefits of business hygiene factors periodically.

Another important measure we introduced at Ayurvet was the adoption of the Triple Bottom-line approach for sustainable business development. Triple Bottom-line is a business model with comprehensive consideration of people, planet, and prosperity which will ultimately lead to increased resilience and cost savings, decreased organizational risk (i.e. supply chain and public relations), a decrease in unforeseen costs, and overall success and inclusive growth of all stakeholders. I can proudly claim that Ayurvet is doing business on a sustainable basis and reporting its Triple bottom-line performance on international GRI guidelines from the last more than 10 years.

What advice would you give to the aspiring CFOs? ‘Be flexible, be adaptable, and embrace change’.

It’s an exciting time to be a middle-market CFO as the role is going through a major transformation. However, it is no longer enough to be merely the financial steward of the organization.z The modern CFO is expected to bring strategic ideas to the C-suite table, is heavily involved in developing and executing the company’s strategic agenda and is expected to affect change throughout the entire organization.

Soft skills of commercial acumen, presentation, and problem-solving are as important as technical ability. Another important key is building a strong relationship with other stakeholders.

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HOW FINANCIAL INSTITUTIONS CAN SHAPE THE COUNTRY’S ECONOMIC DEVELOPMENT?

R

ising global inequality is one of the most serious social and economic challenges of the 21 century, and it has been exacerbated by the COVID-19 pandemic.

While inequality is a global challenge, it is often felt more acutely in developing countries right from a larger informal sector, greater regional divisions, wider gaps in educational access, and more significant obstacles to employment for women. Financial inclusion is frequently considered an important factor in closing these gaps while also promoting better socio-economic outcomes.

Financial inclusion is becoming a top priority for governments and, as a result, will likely become more important to businesses and investors. Finance and technology integration is accelerating financial inclusion and creating compelling investment options in fast-growing economies. Improving the financial status of the country’s people is the very first step to driving the change and here’s how financial institutions are striving for it.

and profitability, on the other hand, have risen to the top of the priority list as the industry has recovered from the global financial crisis.

With opportunities all over the world, prioritising those with the greatest social impact and/or financial returns is a good place to start. Financial inclusion will be most beneficial in markets that embrace technologyled innovation and have a straightforward and supportive policy approach to financial stability. When focusing on improving their investments in financial inclusion, banks should look for potential indicators.

Why Financial Inclusion Is An Opportunity for Banks?

Banks' strategic agendas have included two seemingly contradictory priorities over the last decade. On the one hand, repairing their reputations has been an ongoing imperative in the aftermath of high-profile scandals, rising public scepticism, and the emergence of compelling new players and services in the industry. Growth

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10 Best CFOs in India 2022

How India’s Economy Is Likely To Strengthen With This Change?

India is one of the fastest-growing markets for financial inclusion, thanks to government initiatives and public-private partnerships.

The PM Jan Dhan Yojana (PMJDY) scheme, priority sector lending directives to all financial institutions, and the government's Unified Payments Interface (UPI) platform are all examples.

The JD scheme allowed Indians to open a Jan Dhan bank account using the Adhar biometric ID system. This, combined with rapidly increasing mobile usage, has accelerated digital adoption. As a result, as of May 2021, PMJDY had served 424 million Indian citizens, including 234 million female

10 Best CFOs in India 2022

customers. In addition, the scheme increased the number of financial services outlets in rural Indian villages from 67,694 in March 2010 to nearly 13 million by the end of 2020.

The introduction of the UPI, an instant realtime payment system, has also increased the use of cashless payments, with major telecom companies assisting in driving adoption.

in-Focus

34

Aligning Key Metrix for Better & Secure Banking Experience

Sachin Jain

O

ne of the most critical of business sectors is banking. With it going digital faster than ever, the banking sector is experiencing the worst of cyberattacks.

It is the bank’s responsibility to provide an uncompromised experience that is modern, touchless, faster and all this while being secure. On the other hand, with banks expanding their branches globally, complying to every country’s banking policy and regulatory details is equally important.

Hence an expert who has the best of finance knowledge and is apt in making strategies to align with the laws of the land while grow with customised services is the need of the hour.

When South Korea based Shinhan Bank appointed Sachin Jain as its CFO and Strategy Head, he turned the table in favour of the bank with some of the hardest through restrategising their technology strategy and strengthen digital/branchless banking experience while ensuring a very closely knit customer experience. TradeFlock spoke to Sachin to know about his next moves within the organisation and how he become a more customer-centric and customer-first business.

How do you as the CFO of a bank align the digital banking experience in a secure fashion for your customers?

The ongoing pandemic has forced all subsectors within the banking and financial services industry to innovate. The true potential

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Sachin Jain

CFO & Strategy Head Shinhan Bank kicked off with digital transformation. Today, almost every Indian owns a smartphone and can digitally apply for a loan, complete e-KYC, open a bank account, and other essentials.

It is important for us to train and upskill our relationship managers with the right data and intelligence to customers for providing better services. Leveraging the right technology and solutions is critical to collect such internal data efficiently, while maintaining safety and security.

We personalise services for customers, offer the right advice and re-assess our operations and strategies so that we can reach out to customers better.

What strategies have you proposed for this financial year for Shinhan Bank and how do you plan to make the bank’s presence stronger in the Indian market?

During pandemic, the sector witnessed significant movement in retention of customer confidence. The pandemic, however, did force the bank to re-examine their technology strategies and strengthen digital/ branchless banking, offer improved services to its customers, and outline customer relationships.

During the pandemic, we understood the importance of anticipating customer needs and expectations. Becoming a customercentric and customer-first organisation is essential to ensure not only survival in the

10 Best CFOs in India 2022

market but also retain existing customers.

We focus on shifting from solely providing transaction-focused services to value-driven services to its customers. The value addition perceived by the customers from such services will help banks build long-lasting relationships with its customers.

How do you ensure that the bank’s NPA remains low or nil?

Any challenge that you face in the process and how do you nullify it?

Pre-sanction and post sanction credit monitoring has a major role in reducing NPAs apart from effective MIS and monitoring of early warning signals about the borrowers. Further rephrasing loan installments wherever necessary, applying for settlement of the claim, compromise settlements like One Time Settlement (OTS), and Out of Court Settlement (OCS), are parts of the process involved in reducing NPAs. Gathering correct market information at apt time is one of the major challenges. Bank takes preventive and effective measures in NPA management by carrying out the recovery procedures and mechanisms required to restore the financial assets.

How are you enabling better growth and decisions for the organisation? How has the role of the CFO transformed over the years?

Apart from traditional finance management and number-cruncher stereotype, CFO role is more towards strategic player in the organisation.

CFO is emphasising more towards creativity, and rapidly adopting best practices which enhance create more value for the organisation.

We identify, evaluate and execute strategies by partnering with senior management, implement a process to define optimal targets and to measure the performance of the strategic initiatives through KPI framework. We also understand effective governance models over growing business complexity recently.

10 Best CFOs in India 2022

What would be five of your new focus areas in the coming times?

CFO role is more about innovative practices, adopt new technologies and trends from big data and the digitisation of finance processes to understand business complexity. Some of my focus points are achieving strategic and financial objectives to stimulate behaviors across the organisation and providing financial leadership in determining business direction and longer-term strategies vital to the future performance of the bank so as to align financial and business strategies. To balance capabilities, talent, costs and service levels to fulfill the finance organsation’s responsibilities and to protect and preserve the assets of the organisation by ensuring company compliance with financial reporting and control requirements will also continue to be our focal areas.

From a CFO’s perspective, how can organisations best address the resulting strategic challenges and be prepared for the future?

CFO plays a major role in ensuring the best strategy and most efficient execution.

Company’s success also depends spending more time on strategy. Companies value the hard data and empirical mind-set that a finance chief can lend to strategic planning, especially forecasting trends, building strategic capabilities and regulatory relationships.

CFO main aim constitutes driving organic growth, expanding into new markets, and pursuing M&A. Additionally, CFO gathers competitive intelligence, closely tracks the behavior of competitors, monitors their potential responses to a company’s strategic moves, and evaluate their sources of competitive advantage for future constructive anticipation.

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Expert Talk

Effects of income tax changes on economic growth

C

hanges in income tax have a direct effect on economic growth. Every individual, their savings, and behaviour of investment gets affected as they greatly depend on income tax. The net impact of regulatory changes is uncertain but estimates state that it can be either small or negative.

Key points z Not every change in income tax policy has the same impact on economic growth. If tax cuts are not adequately designed, they can even reduce the economy's growth.

CA Harshil Goyal Co-Founder, Especia- Start-ups

z Tax cuts whose objective as well as target is to achieve a new economic activity, from reduced distortions to accumulation of capital, and are not deficit financed are more to result in economic growth.

Changes in income tax and economic growth The effects of income tax changes on economic growth can be witnessed by changes in the gross domestic product (GDP), employment, and gross national product (GNP). Changes in income tax can also be a substitution effect where a tax cut results in economic growth where an individual can invest more, save more, and work more.

Also, changes in income tax can be an income effect where a tax cut can result in an increment in the income of any individual. This results in a maintained lifestyle by investing less, saving less, and working less. The effects of tax cuts on economic growth are short-run.

Tax cuts are least related to the economic conditions currently. They target individuals with lower income, which can be followed by economic growth in a few years.

Tax cuts that are deficit-financed result in a long run of higher taxes. These kinds of tax cuts do not produce any long-run economic growth. If capital flow internationally is also failed, then it reduces the chances of success of change in income tax and economic growth.

It reduces savings. The economic growth by changes in income tax depends on two factors. These two factors are:

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z How and in what manner tax cuts are financed. z The flow of international capital is assumed.

The structure and financing of a change in income tax are critical to achieving growth in the economy. In one way, changes in income tax encourage many individuals to invest, save and streamline other operations. But in another way, if spending cuts do not align with tax cuts, it could raise interest rates and reduce national savings.

What is the way forward?

The total impact on economic growth is uncertain though. It is either negative or small. Many measures can help to eliminate deficit tax cuts, but at the same time, the impact on labour supply, investments, and savings is also reduced. This directly reduces economic growth per capita and the country as a whole. Some resources might also get reallocated in sectors with high economic use.

This increases efficiency as well as potentially increases the total size of the economy.

Thus, all tax changes do not have the same economic growth. The long term effects of tax policies thus not just depend on incentives effects but also the budgetary effects.

10 Best CFOs in India 2022

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Vikas Maheshwari

The Finance Virtuoso Building on Experience

Learning is not a one-time event or a periodic luxury. Great leaders in great companies recognize that the ability to constantly learn, innovate, and improve is vital to their success.

– Amy Edmondson

V

ikas Maheshwari, CFO, KIMS Hospital, is a staunch believer of continuous learning because he deems that a CFO is not just responsible for the success of the organization but also leverage their financial knowledge and acumen to maintain fine balance between growth and financial health of organisation along with positioning their organization globally. With the increasing additional regulatory burdens, it is the CFO who has to ensure adequate assessment and risk management or other legal requirements, and for Vikas, it is no flyspeck.

Holding 25 years of extensive experience, Vikas started his career as head of accounts and finance. Today he leads one of India’s biggest hospital chains, KIMS Hospital Hyderabad as its CFO. His versatile experience of working with small companies to large companies have played a pivotal role in taking KIMS Hospital to new heights. In fact, under his leadership, KIMS and Endurance Technologies went public with very successful IPOs. Vikas can be defined as a man of different skills. In his career, he had handled most of Corporate Finance

39

Vikas Maheshwari CFO, KIMS

activities i.e. M&A, complex deal structuring, treasury, strategy, PE transactions, complex fund raising (ECB, FCCB, structured funding), investor relations, investments, Risk Management, credit rating, MIS, and Budgeting etc.. With his dedication, he is looking forward to taking the company to another level.

TradeFlock is glad to interview him to understand his success mantra and uniqueness.

Tell us about your unique skills that differentiate you from your peers in the industry.

Since the beginning of my career or even in my college days, I was very much focused and fascinated with the corporate finance world and have followed the subject very closely.

What helped me more was my interest in the Stock Market. Once you are in Stock market, learning about the whole universe of corporate finance is fast as hard-earned money is involved. I feel, It was my luck to start my career at a relatively small company

10 Best CFOs in India 2022

but growing very fast. The learning curve was very steep as in a small company, you get widespread exposure to the whole business and learning is not confined to one vertical, as mostly in big companies.

Throughout all my career, I have worked in corporate finance, as such, had the chance to work closely with the CFO office and promoters, which has helped me to learn faster. The key differentiative factors of success are understanding of the whole spectrum and function of the company, vision of the company and promoters, having a relatively better grasp on various nuisances of large M&A, integrations pains, deal structuring, funding options, skill of delegation & proper risk management.

As a CFO, how do you determine the profitability of an investment?

In this aspect, I think nothing is better than looking at ROCE, ROIC, ROE, payback period etc.

CFO has found an important place in the boardroom.

How are you enabling better growth and decision for the organization?

No doubt, CFOs play a greater role to put up a plan to meet the organization and promoter’s visions. Obviously, any growth requires capital (both equity and debt) and maintaining healthy financial ratios. Maintaining sustainable balance of Capital structure is a great challenge in the path of growth aspirations.

In addition to managing from the diligence of the market to product, competitions, future technologies or product developments, technology-enabled services, the right talent, etc. are other parts which require a lot of time and energy to put up a right plan to the board for its approval. Execution strategy, monitoring framework etc. are the steps that a CFO should take to ensure better growth of the organization.

10 Best CFOs in India 2022

How has the role of CFO transformed over the years?

What would be your new focus areas in the coming times, looking at this transformation?

Today, the role of a CFO is under greater scrutiny, both internally and externally.

CFOs faces never-ending pressure to cut costs, grow revenue, and ensure control.

Economic uncertainty, increased regulatory requirements, financial restatements, and increased investor scrutiny have forced them into the spotlight.

CFOs are expected to play four important, diverse & challenging roles. Two traditional roles are steward – preserving the assets of the organization by minimizing risk and getting the books right, and operator – running a tight operation that is efficient and effective to meet organizational goals. It’s increasingly important for CFOs to involve in strategy, help to shape overall strategy and direction, and catalysts, instilling a disciplined financial approach and mindset throughout the organization to help the business perform better.

These varied roles make a CFO’s job more complex than ever.

State some of the experiences you had related to strategy development.

KIMS is a dominant brand built and capitalizing on the same, we acquired assets at strategic locations i.e. Kurnool, Vizag, Anantapur to deepen our presence in two states i.e. Telangana and Andhra Pradesh.

Recently, we acquired a chain of hospitals (3 hospitals in Telangana) i.e. Sunshine hospitals chain which has further strengthened our position and given us a leadership position in Ortho practice. All these 7 hospitals were acquired in very strategic manners, timelines, and financial structuring without burdening the balance sheet (in spite of spending close to $100 million for acquisitions) and KIMS still maintains industry-leading ROE and ROCEs.

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