India's manufacturing activity moderates in January amid slower increase in total sales
The seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index (PMI) fell from December's recent high of 57.8 to 55.4 in January, as factory orders and production rose at sharp, albeit slower, rate.
India's manufacturing sector activity moderated in January amid slower increase in total sales, and headcounts were broadly unchanged amid sufficient staff numbers to cope with current requirements, according to a monthly survey.
The seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index (PMI) fell from December's recent high of 57.8 to 55.4 in January, as factory orders and production rose at sharp, albeit slower, rate.
The January PMI data pointed to an improvement in overall operating conditions for the 19th straight month. In PMI parlance, a print above 50 means expansion while a score below 50 indicates contraction.
"Despite some loss of growth momentum, the sector looks set to at least remain in expansion mode as the final quarter of the current fiscal year draws to a close," said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence.
The rate of expansion eased from December, but remained sharp and above its long-run average. Panellists suggested that marketing efforts bore fruit, with demand resilience and favourable economic conditions also supporting sales.
"Rising backlogs and the purchasing of additional inputs suggested that companies will continue to lift output in the coming months. Less challenging supply-chain conditions meant that firms were able to secure critical inputs and rebuild their inventories as intended," Lima added.
The latest results suggested that the domestic market was the main source of new business growth as international sales rose only slightly in January. Moreover, the rate of increase was below its long-run trend and the weakest in the current ten-month period of expansion.
Catch the latest updates of Budget 2023
"A key area of weakness seen in the latest PMI data was exports. Although manufacturers received new orders from international markets, the increase was slight at best and moderated considerably to a ten-month low," Lima said.
On the inflation front, there was a quicker, albeit historically subdued, increase in input costs. Charge inflation softened in January, but remained above the long-run series trend.
"There was a mild resurgence in cost pressures, which manufacturers linked to higher prices for items like energy, metal and electronic components. The rate of cost inflation remained historically subdued, but companies nevertheless hiked their fees as demand resilience facilitated the passing on of additional cost burdens to clients," Lima said.
On the employment front, companies sought to expand inventories, employment levels were left broadly unchanged as capacities were reportedly adequate for current requirements.
The S&P Global India Manufacturing PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers. The panel is stratified by detailed sector and company workforce size, based on contributions to GDP.
Click here to get more stock market updates I Zee Business Live
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
Retirement Planning: SIP+SWP combination; Rs 15,000 monthly SIP for 25 years and then Rs 1,52,000 monthly income for 30 years
EPF vs SIP vs PPF Calculator: Rs 12,000 monthly investment for 30 years; which can create highest retirement corpus
Retirement Calculator: 40 years of age, Rs 50,000 monthly expenses; what should be retirement corpus and monthly investment
SBI 444-day FD vs Union Bank of India 333-day FD: Know maturity amount on Rs 4 lakh and Rs 8 lakh investments for general and senior citizens
Home loan EMI vs Mutual Fund SIP Calculator: Rs 70 lakh home loan EMI for 20 years or SIP equal to EMI for 10 years; which can be easier route to buy home; know maths
11:41 AM IST