India's industrial growth moderated to a 4-month low of 6.7% YoY in Sep-26 from 7.8% in Aug-26, with Mining & Quarrying contracted for the third straight month
Download ReportQuantEco Research | IIP | Sep-26 | Momentum holds; headwinds build
India's industrial growth moderated to a 4-month low of 6.7% YoY in Sep-26 from 7.8% in Aug-26, as Mining & Quarrying contracted for the third straight month and growth in Capital Goods and Consumer Durables cooled on a high base. That said, underlying momentum remains healthy, with IIP rising 0.97% MoM, well above the 3-year September average of 0.26%, while the heavyweight Manufacturing and Electricity & Gas Supply sectors continued to outpace their series medians. On an FYTD basis, IIP growth improved to 6.8% in Apr-Sep FY27 from 4.4% a year ago, led by Capital Goods and Intermediate Goods. That said, headwinds are mounting for H2 FY27. The re-escalation of the Middle East conflict has pushed Brent crude back to triple-digit territory, the southwest monsoon ended with a 13% deficit, a strong El Nino threatens the rabi crop, the GST-led boost will fade from the base, and the RBI has pivoted to tightening policy. We remain cautious on the H2 FY27 outlook, with risks tilted to the downside.