India’s industrial production ended 2022 on a resilient note, expanding by 4.3%YoY in Dec-22 compared to 7.3% in Nov-22
Download ReportQuantEco Research || Dec-22 IIP - A decent closure to 2022
India’s industrial production ended 2022 on a resilient note, expanding by 4.3%YoY in Dec-22 compared to 7.3% in Nov-22 (revised up by 20 bps). Growth was in line with market consensus pegged at 2.7% and 4.5% respectively. Incrementally, a healthy increase in the index at 5.3%MoM built on the 6.3% expansion recorded in the previous month, was broadly in line with historical jump of 6.7% recorded (on average) in the month of December. For Q3 FY23, IIP growth improved to 2.5% from 1.6% in Q2FY23, despite Oct-22 growth being in contraction.
Looking ahead, industrial growth is likely to find support in Q4 FY23 and FY24 emanating especially from domestic impulses – of higher rural demand, upswing in industrial credit, augmented Government capex and improving capacity utilisation levels. However, slowdown in exports amidst the anticipated moderation in global growth could create pressure points. In addition, the impact of past cumulative hikes of FY23 will have a bearing on leveraged urban consumption and investments in FY24. We expect FY24 GDP growth to moderate to 6.0% from an estimated 6.8% in FY23.