India Inc must save capital: L&T

In the face of a credit crunch in the global and domestic markets, Indian corporates will have to preserve capital and judiciously use it for their expansion plans, Larsen and Toubro chief financial officer Y M Deosthalee said.

"We need to preserve capital and use it judiciously," he said at a seminar.

Given that foreign funding sources have dried up, the dependence of corporates on the domestic debt market is going to be high in the period ahead, Deosthalee said.

Only a few Indian corporates managed to tap foreign funding sources in this time of recession, he said. The syndicated loan market in India has almost closed, the L&T official observed.

According to him, in order to face the difficult times, corporates need to chalk out their business growth plans in the medium-to-long-term rather than taking into account just short-term factors. Indian corporates also need to tighten their risk-management mechanisms, he said.