India’s manufacturing industry saw improved growth momentum in April, with output rising at its fastest rate since June 2024, driven by strong order book expansion. Total sales were bolstered by the second sharpest increase in international orders since March 2011, S&P Global and HSBC said in a press release.
India’s manufacturing PMI edged up to 58.2 in April, the strongest sector health in 10 months.
Output rose at its fastest rate since June 2024, supported by robust domestic and export demand.
New orders and employment grew sharply, while selling prices surged to an 11.5-year high.
Input costs rose modestly, yet firms passed these on.
Optimism remained strong amid rising enquiries and stock building.
This positive trend was accompanied by notable rises in employment and purchasing activity. Robust demand for Indian goods boosted firms’ pricing power, with selling charges hiked to the greatest degree since October 2013. This was despite a modest uptick in input costs.
The headline figure was spurred by faster increases in stocks of purchases, employment and production. Indeed, output rose at a sharp rate that was the quickest since June 2024. Sub-sector data showed widespread expansions, with the fastest increase registered at consumer goods makers. A key factor contributing to the latest improvement in output growth was a sharp rise in new orders. Little-changed from March, the rate of expansion was the second strongest for nine months.
Respondents attributed growth to better domestic and international demand. With the sole exception of January, new business from abroad grew to the greatest degree in over 14 years at the start of the 2025-26 fiscal year, as per the report. When reporting sources of demand growth, survey participants cited Africa, Asia, Europe, the Middle East and the Americas.
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.
Reports from surveyed firms indicated that companies continued to transfer rising costs on to customers. Input prices rose at the fastest pace in four months during April, with businesses citing higher expenses for building maintenance, labour, leather, paper, rubber, steel, and transportation.
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. Manufacturers continued to enhance their staffing levels in April to meet growing output requirements. Exactly 9 per cent of survey participants took on extra workers, with a combination of permanent and temporary contracts reportedly being offered.
The rate of job creation was marked by historical standards. 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. Vendor delivery times shortened in April amid a lack of pressure on supplier capacity. Although the fastest in three months, lead times shortened only slightly. Strong optimism regarding output prospects over the coming year was evident in the April data, driven by expectations of demand strength. Marketing efforts, efficiency gains and new client enquiries also underpinned positive forecasts, added the report.
“The notable increase in new export orders in April may indicate a potential shift in production to India, as businesses adapt to the evolving trade landscape and US tariff announcements. Manufacturing output growth strengthened to a ten-month high on robust orders. Input prices increased slightly faster, but the impact on margins could be more than offset by the much-faster rise in output prices, of which the index jumped to the highest level since October 2013,” said Pranjul Bhandari, chief India economist at HSBC.
Fibre2Fashion News Desk (SG)