Factory output up significantly in Q2: Ficci Survey

Business outlook in the country has improved significantly in the ongoing quarter with a majority of companies reporting higher production, a Ficci survey released on Sunday showed.

Around 61% of the respondents expect higher year-on-year production in the second quarter (July-September) while 72% expect a higher number of orders than in the previous quarter, as per Ficci’s quarterly survey on manufacturing.

In the second quarter of FY21, only around 24% of respondents had reported higher production, the industry association said.


Respondents also witnessed a rise in the cost of doing business and production, it said.

They attributed the increase in production costs primarily to high fixed costs, higher overhead costs for ensuring safety protocols, lower capacity utilisation, high freight charges and other logistic costs, increased cost of raw materials, power cost, and high-interest rates.

“The cost of production as a percentage of sales for manufacturers in the survey has risen for 80% respondents in Q1 2021-22,” Ficci said in the statement. “This is considerably higher than that reported in Q4 2020-21 where 72% respondents recorded an increase in their production costs.”

Responses have been drawn from over 300 manufacturing units from both large and SME segments with a combined annual turnover of over ₹2.7 lakh crore.