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Below The Perspective on GDP Q1 FY24 by Ms. Madhavi Arora, Lead Economist, Emkay Global Financial Services

“While the Apr-June Q growth print is in line with our expectations, the growth mix was a bit of a surprise. Ideally, the YoY fall in commodity prices should have boosted manufacturing firms’ operating profits and thereby lifted the value added growth of manufacturing sector. Thus, the disappointment on that front was surprising. On the other hand, strong government capex and credit growth expectedly led to double-digit construction sector growth and financial services growth respectively. While we retain our FY24E GDP growth at sub 6% ,we recognize economic activity recovery is not yet broad-based. Besides, falling income growth in urban sector, shrinking corporate profitability, demand-curbing monetary policies and diminishing global growth prospects may weigh on output. However, factors like sustained buoyancy in services momentum and policy thrust to increase trend growth could counter those downward pressures.”

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