Comment on IIP for September by Payal V Pandya, Vice President, Bajaj Broking Prive
Below the Comment on IIP for September by Payal V Pandya, Vice President, Bajaj Broking Prive
The September 2026 IIP growth of 6.7% YoY is a tad moderate as compared to the revised 7.8% growth recorded in August 2026. However, the 11.2% YoY increase in electricity, and gas supply is encouraging. While one of the reasons for higher power and gas consumption was the El Nino effect and weaker monsoon across the country, the more encouraging reason was boost in MSME activities and manufacturing which also registered a robust growth of 7.6% during September 2026. Sustained momentum in infrastructure and manufacturing segments naturally pushed up industrial energy consumption. Sectors like cement production (+9.8%), iron ore (+18.4%), and electrical equipment manufacturing (+33.9%) operated at high capacities, intensifying bulk electricity intake.
Looking ahead, we expect momentum across the core and manufacturing sectors to remain healthy through H2FY27, providing support to India's FY27 GDP growth outlook. Additionally, a stable interest-rate environment, with policy rates remaining broadly within a ±50bps range from current levels, should be conducive to an improvement in private-sector capex activity over the coming quarters, further underpinning industrial and infrastructure growth.
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