Workers use machines to finish the steel products manufactured at a factory in a suburb of Bengaluru. Image for representation
| Photo Credit: AP

Manufacturing activity as measured by the Seasonally Adjusted Purchasing Managers Index (PMI) climbed to an eight month high of 58.1 in March 2025, according to a statement from S&P Global. This number was 56.3 in February 2025.

A PMI value above 50 is considered an expansion and the metric has been above this value for 45 months straight.

The improvement in PMI number in the month under review was attributed to increase in new orders.

“India registered a 58.1 manufacturing PMI in March, up substantially from 56.3 during the previous month. Although international orders slightly slowed, overall demand momentum remained robust, and the new orders index recorded an eight-month high of 61.5. Strong demand prompted firms to tap into their inventories, causing the fastest drop in finished goods stocks in over three years. Business expectations remained fairly optimistic, with around 30% of survey participants foreseeing greater output volumes in the year ahead, compared to less than 2% that anticipate a contraction,” said Pranjul Bhandari, Chief India Economist at HSBC.

Sales numbers expanded at a robust rate and companies had “positive customer interest, favourable demand conditions and successful marketing initiatives” according to the statement. Production volume also increased at the end of 2024-25. New export orders increased but the growth was the slowest in three months, HSBC said in the statement.

Input prices increased to three-month high but was below its long-run average. The increase in prices charged for goods was at a softer pace, the statement said.

“favourable demand conditions, better customer relations and projects pending approval underpinned upbeat forecasts for output levels in the coming 12 months.” said HSBC in it statement.