According to the survey, more than 79% of respondents shared higher production levels in Q2FY24 and average capacity utilization was higher at 74% in Q2 compared to 73% in the previous quarter. last quarter.
According to the latest “Quarterly Survey of Indian Manufacturing” released, manufacturing growth accelerated in July-September across ten key sectors and is expected to continue in the coming quarters. in the financial year 2023-24 (FY24), despite a slowdown in developed countries. by the Federation of Indian Chambers of Commerce and Industry (FICCI) on Monday.
According to the survey, more than 79% of respondents shared higher production levels in Q2FY24 and average capacity utilization was higher at 74% in Q2 compared to 73% in the previous quarter. last quarter. However, ‘need’ was cited as the main limiting and constraining factor, with over 40% of respondents highlighting this as an important constraint.
“The current average capacity utilization in the manufacturing sector is around 74%, reflecting sustained economic activity in the sector. This is slightly higher than the 73% capacity utilization rate reported in previous quarters. Future investment prospects also improved compared to the previous quarter as more than 57% of respondents said they planned to invest and expand in the next six months. This is also a slight improvement compared to the previous survey,” the survey added.
Demand has proven to be a major obstacle and limiting factor in realizing the true potential of the manufacturing sector in India. “Whether domestic or export demand, this is still a major limiting factor.” Some other constraints, although not major, are high raw material prices, increased financing costs, logistics and other supply chain disruptions, he said, which are some of the major constraints affecting the plan. “expand the number of respondents”.
The survey was conducted in 10 sectors: automobiles and auto components; capital goods and construction equipment; cement; chemicals, fertilizers and pharmaceuticals; electronics and equipment; machine tools; metals and metal products; textiles, clothing and technical textiles; paper; and miscellaneous – comprising over 380 manufacturing units of large, small and medium enterprises with a total annual turnover of over Rs 4.88 lakh crore.
80% of Q2FY24 respondents had higher orders, while 85% of respondents had higher or similar inventory levels in Q2. Regarding exports, more than 48% respondents said exports in the second quarter were higher compared to 33% in the first quarter of fiscal 2024.
“However, there is a need to further improve export demand to meet the country’s growth aspirations.” , he added. Regarding hiring prospects, 38% of respondents plan to hire more workers in the next three months. Electronics and home appliances; cement; Automobiles and machine tools outperformed, while sectors such as capital goods and construction machinery, chemicals, textiles, metals, paper and others showed moderate growth.
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