The real estate, construction & industrial product segments are expected to see more revenue impact and business disruption on account of coronavirus spread, indicates the findings of a recent survey.
Protiviti India’s Business Resilience Barometer survey said that 57% of respondents from real estate and construction sector, and 42% of respondents from industrial product sector envisage a negative revenue impact exceeding 25%. “In terms of company size by revenue, 38% of respondents from companies over ₹1,000 crore revenue foresee a negative revenue impact of over 25%,” it said.
“Industrial products, real estate and constructions industries feel the most impact with 55% and 50% of their respondents anticipating disruption of 6 months or more,” the survey said.
It added that 40% of the healthcare and life sciences industry respondents, and 33% of technology, media and communications industry respondents either foresee no disruption or anticipate disruptions between 1 to 3 months.
As far as profitability and cost is concerned, 43% respondents from real estate and construction sector, 38% respondents from industrial product sector, and 36% respondents from healthcare and life sciences sector envisage a negative profitability impact of over 25%.
Reduction in support function and infrastructure and rental costs emerged as one of the key areas of cost reduction, with 80% respondents foreseeing definite reduction with human capital cost coming close with 79% respondents considering reduction, it said.
As many as 80% of all respondents see automation as either a moderate or a significant enabler for cost reduction.
Nearly 55% of the respondents foresee job losses in their respective industries after the lockdown ends, and 28% of respondents from real estate and construction industry anticipate lay-offs of more than 10%.
The findings of the survey reveals strong revival initiatives amidst fall in revenue of up to 25% and business disruptions of up to 12 months for non-financial services organisations.
“The past quarter has seen the ultimate test of resiliency for any organisation in India, as they recalibrate their business strategies in response to the COVID-19 induced crisis,” it said.
Commenting on the survey, Nirmalya Gupta, managing director, Protiviti Member Firm for India said, “I think we will see increased investments in disruptive technologies, automation and digitisation and more agile and flexible operations in days to come.”
“Organisations will increasingly adopt to newer ways of accelerating their businesses and will look to build robust control frameworks around them. The entire corporate world have to up-skill and adapt themselves to these newer ways of working,” he said.
