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Below Is On Perspective on Q3 GDP Data By Mr. Nikhil Gupta, Chief Economist, MOFSL group

3QFY23 GDP at 4.4% YoY; slightly lower than expectation

Contrary to our expectation of ~4.5% YoY and Bloomberg consensus of 4.6% YoY, real GDP growth in 3QFY23 came in at 4.4% YoY, v/s 13.2%/6.3% YoY in 1Q/2QFY23. (1Q number revised from 13.5%).

This was on account of collapse in consumption, both private as well as government. Capital formation held up overall GDP growth in 3Q.

Real GVA grew 4.6% in 3QFY23 v/s 12.1%/5.5% YoY in 1Q/2QFY23. Both 1Q/2QFY23 numbers have been revised downwards from 12.7%/5.6%, respectively. Farm GVA and industrial activities grew faster (despite a contraction in manufacturing) in 3Q but services activity grew at three-quarter low.

CSO has revised its FY22 real GDP growth to 9.1% YoY v/s 8.7% estimated earlier. Additionally, second advance estimates peg FY23 real GDP growth at 7%, which means that it expects 4QFY23 to grow by 5.1% YoY, which we believe is highly unlikely.

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