India’s manufacturing PMI hits 4-month high in April
2 min read 01 May 2023, 11:28 PM ISTThe survey showed that although manufacturers signalled higher operating costs linked to fuel, metals, transportation and some other raw materials last month, the overall rate of inflation has remained below its long-run average despite quickening since March.
PremiumNew Delhi: Manufacturing activity grew the fastest in four months in April, driven by healthy factory orders, milder price pressures, better global sales and improved supply chains, according to a survey report published on Monday.
The S&P Global India Manufacturing Purchasing Managers’ Index (PMI) rose to 57.2 in April from 56.4 in March. For 22 straight months now, the PMI has remained above 50, the mark separating expansion from contraction.
“Rising from 56.4 in March to 57.2 in April, the seasonally adjusted S&P Global India Manufacturing PMI indicated the fastest improvement in the health of the sector in the year-to-date (calendar)," a note from S&P Global said.
The survey showed that new orders placed with goods producers rose at the quickest pace since December.
The rate of expansion was sharp and above its long-run average.Those surveyed were of the view that the upturn was supported by favourable market conditions, demand strength and publicity.
Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said: “Reflecting a robust and quicker expansion in new orders, production growth took another step forward in April. Companies also benefited from relatively mild price pressures, better international sales and improving supply-chain conditions."
Lima was of the view that Indian manufacturers have “abundant opportunities" to keep powering ahead.
“Besides seeing the strongest inflow of new work in 2023 so far, capacities were expanded through job creation, input buying was lifted and pre-production inventories rose at a record rate."
She noted that manufacturers are upbeat on growth prospects, with optimism improving from the eight-month low in March on the back of contracts awaiting approval, rising client enquiries, marketing initiatives and evidence of demand resilience.
The survey showed that although manufacturers signalled higher operating costs linked to fuel, metals, transportation and some other raw materials last month, the overall rate of inflation has remained below its long-run average despite quickening since March.
It also showed that while 6% of companies have hiked their fees since March, 92% left them unchanged.
“Elsewhere, goods producers recorded a marginal increase in outstanding business volumes. Still, firms sought to expand capacities by taking on additional workers," the survey note said.
The marginal upturn in employment comes after a fractional reduction in March, the survey showed.
Indian manufacturers were confident that production volumes would be higher in 12 months‘ time, amid demand resilience, client enquiries, orders pending approval and marketing efforts.
The S&P Global India Manufacturing PMI is compiled from responses from about 400 manufacturers. These responses are collected in the second half of every month.
Official data for March released by the union ministry of commerce and industry released on Friday showed that the output of eight infrastructure industries grew 3.6%, the most sluggish pace since October, as crude oil, cement and electricity sectors saw a contraction, reflecting the impact of unseasonal rain on industries.
Core sector output expanded at 4.3% in March 2022 and 7.2% in February this year. The previous low was 0.7% in October 2022.
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