Private sector activity in India picked up pace in April, driven by capacity expansion, improved demand conditions, increased new work intake, and technology investments, as per the HSBC ‘Flash India PMI Composite Output Index’. The index, which measures the combined output changes in India’s manufacturing and service sectors on a monthly basis, rose from 57.0 in March to 58.3 in April.
New orders saw a faster growth rate compared to March, indicating a robust performance. Employment in India’s private sector also saw an uptick, reaching a 10-month high in April, based on survey data findings.
According to Pranjul Bhandari, Chief India Economist at HSBC, the acceleration in private sector activity, particularly in manufacturing, was notable, with increased output and new orders. Companies are seen stockpiling to navigate uncertainties related to supply chain disruptions.
The survey highlighted a rise in finished goods and input inventories, accompanied by higher purchasing volumes. While input costs remained high, firms partially transferred the cost burden to consumers through increased selling prices.
Inflation rates, although historically elevated, showed a slight retreat from the previous month, mainly due to a moderation in the service sector. Manufacturing witnessed a resurgence with notable growth in output and sales, although price pressures intensified.
Goods producers outpaced service providers in terms of new orders and output growth, with both sectors showing positive momentum. Export trends varied, with goods producers experiencing a faster expansion compared to service providers, who faced a slowdown due to external factors like the Middle East conflict.
At the composite level, new export business saw a softer growth rate in April compared to March, reflecting mixed trends across sectors.
