Angel Broking - IIP Update - June 2012
RAJESH DESAI
Dear All,
Forwarding you the IIP Update for June 2012.
June IIP growth declines by 1.8%
Key highlights
As per the Quick Estimates on the Index of Industrial Production (IIP), industrial growth declined by 1.8% in the month of June 2012 as compared to 9.5% growth in June 2011.
Cumulative growth for the period April-June 2012-13 stood at -0.1% as compared to the corresponding period in 2011-12.
Negative growth in Manufacturing and Capital goods leads to contraction in overall IIP growth.
Performance on Sectoral basis: On a year-on-year basis, Mining recorded a marginal 0.6% growth rate after witnessing negative performance since the past three months. Electricity growth has been robust at 8.8% for the month of June 2012. Manufacturing growth slid into negative territory with a -3.2% growth in June 2012 after having shown a positive growth of 2.6% in the month of May 2012.
Cumulative growth in Mining and Manufacturing for the period April-June 2012-13 has staggered at -1.1% and -0.7% respectively. Electricity sector has performed reasonably well at 6.4%.
In the manufacturing sector, as per the 2-digit level classification in terms of industries, 14 out of the 22 industry groups in the manufacturing sector have shown positive growth during the month of June 2012 on a year-on-year basis. Radio, TV and Communication Equipment and Apparatus is the front-runner with growth of 16.8% while Electric Machinery and apparatus has shown the largest negative growth of 56.0%.
Performance in the Use-based Category: Under the Use-based classification, Basic goods and Intermediate goods recorded a modest growth of 4.1% and 1.6% respectively during the month of June 2012 as compared to June 2011. However, growth in Capital goods has sharply contracted and it stands at a record-low of -27.9%. Growth in the Capital goods sector has been struggling since July 2011, for a large part of the previous year, indicated by the negative growth in IIP for Capital goods with no signs of recovery.
Growth in the overall Consumer goods sector stands at 3.5% in the month of June as compared the corresponding period in the previous year. Consumer durables witnessed growth of 9.1% while growth in Consumer non-durables declined by 1% during the month.
Revision in IIP growth: The IIP figures for May 2012 and March 2012 have been revised. The first revision in growth of IIP for May stands at 2.5% over 2.4% recorded earlier last month and the final revision of IIP data for March 2012 stands at -2.8% from -3.2% on a year-on-year basis.
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Fundamental Advisory Desk
Angel Broking
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CA. Rajesh Desai