India IIP Report ( October 2012): The Diwali IIP proves India an island of riches

The Consumer Durables sub indices hit 16.5% growth in October 2012 over the same month last year as the Diwali festive jump in spends took the Consumer IIP to a new level of contribution. Intermediate Goods also posted a near double digit growth at 9% and overall IIP growth was a never before 8.2% after a 10 month break turning the debate over the relavance of IIP data to a new high pitch successfully derailed the India growth and Investment engines and the bottoms that kickstarted the stock market recovery in August also turned out to be a precariously false upswin gcrashing thru periliously close to the Festive Season. 

The mining Index jumped from 111 to 122 while the 75% weight of the manufacturing data that throws the index off foremost also jumped from 174.7 to 181.9 and Electricity (Utilities) from 149.7 to 160.5 taking the overall score to 171.3. The PmI measures inventory, employment and new orders sub indices as well which all jumped in October and Novemeber was the most benefited as reported last week

Medical, Automobiles and other transport services were still the good double digit performers in the sub indices responsible for the FMCG boom in the results for October 2012 while commercial business activity  sectors coninue to show deep contraction including Furniture, Office Eqpt and Elect Machinery. Metals were back only ont he Auto sector optimism in the month therefore and November Auto sales are already down. All the pointers of pessimism should however be understood in the frame of being over and above the baseline growth projections of just under 6% in the Economy

Publishing and Media indices seem to be one of the fairly new ones in the index ( 2004-05 series) howcasing a 29.6% growth in activity over 2011 but underline the sector’s mainstream status along with services in India’s continuing growth paradigm while Food abnd Beverage sales scored high on continuing growwth in outside consumption as well.





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