Indian industrial production likely to have moderated year-on-year in March

Indian industrial production growth data for the month of March is set to be released this week. According to a DBS Bank research report, the industrial production is expected to have moderated to 5 percent year-on-year from 7.1 percent in the prior month, dragged on by base effects. On a sequential basis, production is expected to have recovered, mirroring the jump in the earlier released by core industries index, stated DBS Bank.

In the latter, there was a rebound throughout segments save for crude oil; better-faring electricity, coal, steel, cement, etc. March PMI-manufacturing had alleviated, possibly due to underperformance of currency and higher commodity prices, feeding into concerns over higher input prices and pressure on margins, but recovered ground in April. Auto sales have continued to remain strong, underpinned by increased sales of commercial vehicles and two-wheeler sales.

“An actual outcome close to our estimate will see IP average 4.4 percent growth in FY18, steady from the year before and recovering from a pre-GST slump in 1HFY18”, added DBS Bank.

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