Press Esc to close
Wednesday 01 October 2014
News updated at 5:44 PM IST
Weather
Max: 29.3°C
Min : 21.4°C
In Bangalore
Sunny day

Analysts sound cautionary note on IIP numbers

New Delhi, Dec 12, 2012, DHNS :
File Photo

 Beating analysts’ expectation, India's industrial production soared by 8.2 percent in October, 2012, compared to -5 per cent in October, 2011, though analysts  said it’s too premature to see signs of recovery.

Though the overall rate for the period April-October 2012 is down at 1.2 per cent when compared to 3.6 per cent during the same period. 

Analysts had expected a rise of 4.5 percent. Further, revised government figures released for September showed that there was a contraction of 0.7 per cent; the earlier estimate was 0.4 per cent.


Manufacturing, which constitutes about 76 percent of industrial production, rose 9.6 percent in October this year. Most experts conceded that industrial output grew at a better-than-expected rate of 8.2 per cent; the growth was aided by low base of last year and festival demand. 

However, analysts sounded a cautionary note. CRISIL Research said, “ It is too early to believe that this type of buoyancy will sustain going forward. As the current industrial slowdown is both well entrenched and broad based, it will take a while for industrial growth to recover.” It expected industrial output growth to remain at muted levels during the remaining months of this fiscal.

Chief Economist at State Bank of India, Brinda Jagirdar said, “To a large extent, the uptick in industrial performance is optical, masking the reality, largely because of base effect. I don't think the RBI should be swayed by this number and should address the underlying weakness in the economy by cutting rates.”

The numbers may not be so encouraging for November, according to an economist at ICICI Securities, A Prasanna.“We should be careful in not over-interpreting this number. With some shifting of festivals in October and more number of working days, we should see some payback in November. Already, we saw the auto sale numbers, which were not encouraging.”

Angel Broking's Bhupali Gursale said, “Growth has been boosted by festival demand and an improvement in the core sector output. Going ahead, the high base for H2, FY2013 does not augur favourably for sustainable expansion but the October number is likely to push up overall growth in industrial production for the fiscal year. ”

Go to Top

Photo Gallery
Players of Kerala Blaster football team pose for a group photo with Kathakali Dancers in Thrissur ..

Players of Kerala Blaster football team pose for a group photo with Kathakali Dancers in Thrissur ..

Barack Obama and Narendra Modi, at the dinner hosted in his honour, at the White House ...

Barack Obama and Narendra Modi, at the dinner hosted in his honour, at the White House ...

Actors Vikram and Karthi participating in a fast to protest Jayalalithaa's conviction ...

Actors Vikram and Karthi participating in a fast to protest Jayalalithaa's conviction ...

Lahore Lions skipper Muhammad Hafeez is bowled during the Champions League Twenty 20 ...

Lahore Lions skipper Muhammad Hafeez is bowled during the Champions League Twenty 20 ...

Congress Vice President Rahul Gandhi provides relief packages to a flood victim in Jammu ...

Congress Vice President Rahul Gandhi provides relief packages to a flood victim in Jammu ...

Modi waves to supporters  in front of the Indian Embassy in Washington ...

Modi waves to supporters in front of the Indian Embassy in Washington ...

People enjoy a sheep fight in Hubli, Karnataka ...

People enjoy a sheep fight in Hubli, Karnataka ...

Chief Minister of Assam Tarun Gogoi interacts with flood victims at a relief camp at Boko ...

Chief Minister of Assam Tarun Gogoi interacts with flood victims at a relief camp at Boko ...

Products made out of waste materials by the students of a college in Rohtak ...

Products made out of waste materials by the students of a college in Rohtak ...

India's Sunil Vitalacharya Sowmarpet and Akashdeep Singh celebrate their victory over South Korea ..

India's Sunil Vitalacharya Sowmarpet and Akashdeep Singh celebrate their victory over South Korea ..

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bangalore - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523