Panorama December 2024 edition is out now!

Here are the key insights from the report:

1. India’s GDP growth slowed to a seven-quarter low of 5.4% YoY in Q2FY25. The manufacturing sector dragged down GDP growth in Q2, while services remained resilient. The weakness in the manufacturing sector was due to a sharp contraction in the operating profit of listed manufacturers in the September quarter and the continued moderation in IIP manufacturing growth.
2. Investment growth witnessed a steep decline as central government capital expenditure contracted due to the general elections in Q1FY25. However, investments by listed companies continue to trend higher at a decent pace. Industrial order flow remains resilient, and private corporate investment intentions reflect a positive outlook.
3. Consumption growth moderated due to weak urban demand, while the rural sector reported recovery. The outlook for rural demand remains positive due to record kharif production and encouraging rabi prospects. Urban consumption is being impacted by weak employment generation. However, green shoots in hiring activity are visible, with a pickup in IT hiring and an improvement in EPFO subscriber additions.
4. Q2FY25 corporate results disappointed due to flat sales growth and a decline in profit growth. Earnings misses outpaced beats in Q2FY25, leading to earnings downgrades. Key economic data released so far in Q3 do not reflect strength in economic activity. FY25 GDP could fall short of the RBI’s revised projection of 6.6% YoY, downgraded from 7.2% YoY earlier. We expect the RBI to cut the repo rate by 25 bps in the February 2025 policy, as the inflation outlook is expected to improve, while growth conditions may remain weak.

Click here to read the full report