India’s private sector activity gathered momentum in April, supported by stronger demand particularly in manufacturing, after a March slowdown due to the Middle East conflict, according to a private survey released Thursday.
The HSBC Flash India Composite Purchasing Managers Index (PMI) rose to 58.3 in April from 57 in March, driven by capacity expansion, better demand conditions, higher inflows of new work and increased investment in technology.
“Manufacturing led the upturn, with faster growth in output and new orders,” said Pranjul Bhandari, chief India economist at HSBC.
The composite PMI combines manufacturing and services indices, with readings above 50 signalling expansion and those below indicating contraction.
Manufacturing PMI rose to 55.9 in April from 53.9 in March, while services PMI edged marginally to 57.9 from 57.5.
“The survey indicated that firms are building buffer stocks to manage the uncertainties around the longevity of the supply-side shock,” noted Bhandari.
Inventories of finished goods and inputs increased alongside a rise in purchasing activity, she added.
Looking ahead, companies anticipate output to grow over the next 12 months, supported by marketing efforts, pending project approvals and a rise in client enquiries.
Although, business confidence eased from March, it remained the second highest in around a year and a half.
Cost pressures continued to mount in April, driven by higher prices of fuel, gas, oil and raw materials. Companies reported increased spending on chemicals, food, jute, leather, metals, rubber and transportation, with some also citing gas shortages as a factor pushing prices higher.
While input cost inflation moderated slightly from March, it remained among the steepest levels seen in nearly three years.
“Input cost pressures remained elevated, and firms passed through part of the increase via higher selling prices,” said Bhandari.
The pace of output charge inflation was slower than that of input costs. Inflation trends differed across sectors, with manufacturing seeing faster increases and services experiencing some easing.
The survey mentioned that new export orders grew at a slower rate than in March, as a faster increase among manufacturers, where growth hit a nine-month high, was offset by weaker expansion in services, which saw its slowest rise in over a year due to the conflict.
Employment growth picked up, with job creation reaching a ten-month high in April. Survey respondents suggested that hiring was driven by rising business needs, expansion plans and optimistic expectations for the year-ahead.
“Hiring growth strengthened at manufacturing firms and their services counterparts, with the quicker upturn among the former,” the survey mentioned.
The HSBC Flash India Composite Purchasing Managers Index (PMI) rose to 58.3 in April from 57 in March, driven by capacity expansion, better demand conditions, higher inflows of new work and increased investment in technology.
“Manufacturing led the upturn, with faster growth in output and new orders,” said Pranjul Bhandari, chief India economist at HSBC.
The composite PMI combines manufacturing and services indices, with readings above 50 signalling expansion and those below indicating contraction.
Manufacturing PMI rose to 55.9 in April from 53.9 in March, while services PMI edged marginally to 57.9 from 57.5.
“The survey indicated that firms are building buffer stocks to manage the uncertainties around the longevity of the supply-side shock,” noted Bhandari.
Inventories of finished goods and inputs increased alongside a rise in purchasing activity, she added.
Looking ahead, companies anticipate output to grow over the next 12 months, supported by marketing efforts, pending project approvals and a rise in client enquiries.
Although, business confidence eased from March, it remained the second highest in around a year and a half.
Cost pressures continued to mount in April, driven by higher prices of fuel, gas, oil and raw materials. Companies reported increased spending on chemicals, food, jute, leather, metals, rubber and transportation, with some also citing gas shortages as a factor pushing prices higher.
While input cost inflation moderated slightly from March, it remained among the steepest levels seen in nearly three years.
“Input cost pressures remained elevated, and firms passed through part of the increase via higher selling prices,” said Bhandari.
The pace of output charge inflation was slower than that of input costs. Inflation trends differed across sectors, with manufacturing seeing faster increases and services experiencing some easing.
The survey mentioned that new export orders grew at a slower rate than in March, as a faster increase among manufacturers, where growth hit a nine-month high, was offset by weaker expansion in services, which saw its slowest rise in over a year due to the conflict.
Employment growth picked up, with job creation reaching a ten-month high in April. Survey respondents suggested that hiring was driven by rising business needs, expansion plans and optimistic expectations for the year-ahead.
“Hiring growth strengthened at manufacturing firms and their services counterparts, with the quicker upturn among the former,” the survey mentioned.