Quote on Core by Aditi Nayar, Chief Economist, ICRA Ltd
Below the Quote on Core by Aditi Nayar, Chief Economist, ICRA Ltd
"Core output rose by a robust 7.9% in September 2026, the fastest pace in the new series, with a favourable base supporting the improvement from the upward revised 5.9% growth seen in August 2026. The uptick was broad-based, with seven of the nine sectors, barring electricity and cement, recording an improvement in their performance in September 2026 vis-à-vis August.
Coal and iron ore output witnessed a meaningful pickup in their YoY growth rates in September 2026 compared to August 2026; while this was aided by a low base, the sequential uptick in coal was quite strong, amid low stocks at power plants. Refinery products output expanded by a series high 10.3% in September 2026, up from 5.6% in August 2026, supporting the growth in core output.
Growth in electricity generation eased somewhat to 11.4% in September 2026 from 13.1% in August 2026, albeit remaining quite strong, as the monsoon deficit supported demand in the month. ICRA now forecasts full year electricity growth at 8.5%, exceeding our baseline forecast for GDP growth for this fiscal (7.1%).
While cement output expanded by a robust 9.8% in September 2026, steel output growth was relatively muted at 4.9% in the month. However, trends in finished steel consumption suggest that construction activity likely remained healthy in the month.
Notwithstanding the uptick in core output expansion, ICRA expects the IIP growth to ease somewhat to 6.0-7.0% in September 2026 from 8.0% in August 2026, with an elevated base weighing on the non-core segment growth in the month."
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