India’s private sector activity strengthened in April, helped by positive demand trends that fuelled new business intakes and output. In both cases, the rates of expansion remained the fastest in close to 14 years, said a survey by HSBC on Tuesday.
According to the survey by the global banker, the headline flash composite PMI (Purchasing Managers’ Index) figure rose to 62.2 in April, compared with an upward revised figure of 61.8 in March.
The index measuring the month-on-month change in the combined output of India’s manufacturing and service sectors was inside growth territory for the 33rd consecutive month. The manufacturing industry led the latest upturn, as was the case in the previous month, although softening growth at goods producers compared with accelerations at service providers.
The survey noted that international sales positively contributed to total order books, with new export orders rising at the fastest rate since the series started in September 2014. On this front, services companies noted the quicker rate of expansion. Anecdotal evidence pointed to stronger sales to clients in Africa, Asia, Australia, the Americas, Europe and the Middle East.
Pranjul Bhandari, chief India economist, HSBC, says that strong performance in both the manufacturing and service sectors, led by increased new orders, resulted in the highest composite output index since June 2010. In particular, services growth accelerated further in April as new orders in both domestic and international markets rose.
“Meanwhile, both composite input and output prices moderated in April, albeit remaining robust. Manufacturing margins improved in April as firms were able to pass on higher prices to customers due to strong demand conditions. In fact, manufacturing industries sharply increased their staffing levels and input buying activity. Overall future business outlook improved further in April, buoyed by robust demand,” he added.
On the employment front, the efforts to meet rising demand and clear backlogs supported further job creation and the slight increase in private sector employment masked notable divergences at the sector level.
“While service providers took on extra staff at a marginal pace that was softer than in March, goods producers raised their workforces to the greatest extent in nearly a year-and-a-half,” the survey noted.
Composite PMI Output Index
*Source: HSBC
First Published: Apr 23 2024 | 5:18 PM IST
