Manufacturing sentiment remains upbeat in Q3 and Q4FY24: FICCI

Manufacturing sentiment remained upbeat in the second half of the year, owing to robust demand, showed results of a private survey conducted by Federation of Indian Chambers of Commerce & Industry (FICCI), Monday.

“...latest survey reveals a sustained and continued period of growth for India’s manufacturing sector in the last two quarters of FY24. Compared to the previous quarter, Q3FY24, when 73% respondents had reported higher production levels, in the current Q4FY24, around 87% respondents expect either higher or same level of production,” FICCI noted in its 61st edition of Quarterly Survey on Manufacturing (QSM).

The average capacity addition remained steady at 73% as well, indicating sustained economic momentum, over half of the 400 respondents surveyed by FICCI indicated investment and expansion plans. The Indian economy likely grew 7.3% in FY24, according to the first estimates of growth released last month.


IMF, in its latest outlook, pegged the growth at 6.5% for both FY25 and FY26.

“Challenges related to the availability of raw materials and their escalating prices, uncertainty in global demand, shortage of skilled labour, market volatility, increased power costs, unutilised capacities, and high bank interest rates, etc are some of the major constraints that are affecting expansion plans of the respondents,” it said.

The results of HSBC Purchasing Managers’ Index survey on manufacturing for January showed an improvement in activity in January. Manufacturing PMI surged to a four-month high of 56.5 in January, recovering from an 18-month low of 54.9, with year ahead outlook also improving.

Among sectors captured by the FICCI survey, respondents from electronics and electricals expected strong growth in the last quarter of FY24 along with machine tools. Respondents in other eight sectors showed moderate growth expectations.

The outlook for exports also received a fillip. India’s exports received a marginal fillip of 1% in December compared with the previous year.

“In exports, about 31% respondents reported higher exports in Q3 2023-24. Furthermore, over 40% of the respondents expect their exports to be higher in Q4 2023-24 as compared to the previous year’s similar quarters,” the survey noted.

Survey respondents highlighted an increase in costs due to rising raw material prices and supply chain constraints.