IIP growth rose to a near two-year high in Jun-26 and Q1 FY27 recording the strongest expansion in six quarters
Download ReportQuantEco Research | Jun-26 IIP - Zooms to a 2-year high
Jun-26 reinforced a robust start to industrial activity in FY27, with IIP growth rising to a near two-year high in Jun-26 and Q1 FY27 recording the strongest expansion in six quarters. The recovery was broad-based across sectors in Jun-26 and was corroborated by improving high-frequency indicators, resilient corporate earnings and easing crude oil prices, which together helped offset the production disruptions caused by the Middle East conflict in the preceding three months. Having said, the outlook on industrial activity remains guarded. While geopolitical tensions continue to pose supply-side risks through elevated energy price volatility and lingering logistics disruptions, deficient monsoon rainfall and the risk of a strengthening El Nino could weigh in turn on agricultural output, rural demand and industrial activity in H2 FY27. Consequently, despite the sector's encouraging start to the year, we expect industrial growth to moderate over the remainder of FY27, consistent with our FY27 GDP growth forecast of 6.4%.