India's manufacturing sector growth improved in the month of
April, with output increasing at the fastest pace since June 2024 on the back
of another strong expansion in order books. Besides, total sales were supported
by the second-fastest upturn in international orders since March 2011. This
positive trend was accompanied by notable rises in employment and purchasing
activity. According to the survey report, the seasonally adjusted HSBC India
Manufacturing Purchasing Managers’ Index (PMI) surged to 58.2 in April as
against 58.1 in March.
The report further noted that the substantial improvement in
order book volumes occurred despite a marked increase in prices charged for
Indian goods. The overall rate of inflation was the highest seen in 11-and-half
years. Input prices rose at the fastest pace in four months during April, with
firms mentioning higher building maintenance, labour, leather, paper, rubber,
steel and transportation costs. That said, the rate of inflation was moderate
and below that seen for selling charges. The strength of new order inflows also
led to another accumulation of outstanding business. Although slight, the rate
of increase was at a 15-month high.
Further, manufacturers continued to enhance their staffing
levels in April to meet growing output requirements. Purchasing activity rose
in tandem with new business growth, and the latest sharp expansion in input
buying was also partly attributed to stock building initiatives. Input holdings
increased to the greatest extent since August 2024. Conversely, post-production
inventories fell at the quickest pace in nearly three-and-a-half years.
Source: Ace Equity
