Apr 20, 2012, 12.31 PM | Source: CNBC-TV18

Economic reality not bad as perceived: Adi Godrej

Adi Godrej, chairman of the Godrej Group, has been elected as the president of Confederation of Indian Industry (CII). He succeeds Tata Steel managing director B Muthuraman.

Adi Godrej, Chairman, Godrej Group
Adi Godrej, chairman of the Godrej Group, has been elected as the president of Confederation of Indian Industry (CII). He succeeds Tata Steel managing director B Muthuraman.

On GST issue, Godrej says, “There is a lot of dissonance between the thinking of some of the states and the Centre. The CII interacted with representatives from various state governments and representatives from the opposition party and tried to explain them the importance of GST and the need of their co-operation to have some unanimity on the GST issue. We also met the finance minister and requested him to be more generous in his ability to cover the possible losses. There aren’t going to be any losses. When people are worried that will face losses, and when you are sure that there will be no losses, it’s when you give what is known as underwriting, guarantees. So, I think we were able to bring the parties together."

”CII will continue to suggest the government on improving the economy. The association will also encourage discussions to improve the economy.
"We have been overly sensitive on some issues. We have had ups and downs in the past. For example, the economic situation in the end of 2008 was quite similar, but we didn’t talk it down. Also, the government was very positive at that time."

"We had a fruitful meeting with the Prime Minister. We started the discussion by saying that, “the reality is not as bad as the perception.” Both the government and CII needs to see to it that we do not get overly negative. At the same time, the government should not make moves that are perceived to be negative that spoil the perception. For example, retrospective amendment, GAAR etc has been badly perceived."

Below is the edited transcript of his interview to CNBC-TV18. Also watch the accompanying video.

Q: How was the response from the Prime Minister?

A: The PM said it would be good if both the industry and government could work together. You cannot solve all the problems of the country in a twenty minute meeting.

 Q: Domestic corporates tell the government off record that will move away with capital if things don’t improve? Is it a real or a false threat?

A: I don't believe any of these stories.

Q: Through the back channel, we understand?

A: I haven't heard it from any industrialist and there is no need to have a situation where we will take our capital from here to there.

Q: It's a manner of putting pressure. It is saying, get your act together or I am going to go elsewhere.

A: It is good to give suggestions and help the government sort out its problems. It is good to talk up the economy. We have talked down the economy more than the reality.

Catch the exclusive interview on the show “The Appointment” on Saturday, 21 April 2012 at 10.00 am and 9.30 pm and Sunday at 8.00 pm only on CNBC-TV18.

Godrej Ind stock price

On November 27, 2015, Godrej Industries closed at Rs 389.85, down Rs 6.35, or 1.6 percent. The 52-week high of the share was Rs 411.55 and the 52-week low was Rs 267.94.

The company's trailing 12-month (TTM) EPS was at Rs 3.94 per share as per the quarter ended September 2015. The stock's price-to-earnings (P/E) ratio was 98.95. The latest book value of the company is Rs 49.36 per share. At current value, the price-to-book value of the company is 7.90.

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