India’s Manufacturing PMI at 57.6 in May, Indicates Continued Growth: HSBC

New Delhi – India’s manufacturing sector maintained its strong performance in May, with the HSBC India Manufacturing Purchasing Managers’ Index (PMI) posting a score of 57.6, according to data released Monday.

Although slightly lower than April’s reading of 58.2, the PMI remains well above the neutral threshold of 50, signaling continued expansion in the manufacturing sector, as per data compiled by S&P Global.

“India’s manufacturing PMI for May indicates another month of solid growth,” said Pranjul Bhandari, Chief India Economist at HSBC. “The acceleration in employment growth to a new high is particularly encouraging. While input cost inflation is on the rise, manufacturers are managing to preserve margins by raising output prices.”

Growth in the sector was driven by strong domestic and export demand, along with effective marketing strategies that pushed export orders to one of their highest levels in the past three years. Indian manufacturers reported increased interest from major markets in Asia, Europe, the Middle East, and the United States.

Hiring also surged in May, reaching the highest level recorded since the PMI survey began. Companies focused on building up their permanent workforce, leading to smoother operations and improved efficiency in handling workloads.

This surge in employment is a positive sign for India’s large young workforce and reflects ongoing investment in the sector’s long-term prospects.

Input costs rose moderately, with price increases seen in materials like aluminium, cement, iron, leather, rubber, and sand, as well as in freight and labor. In response, manufacturers raised selling prices at a solid pace to protect profit margins.

Despite these price hikes, business confidence remains high. Manufacturers expressed optimism about the year ahead, crediting increased customer inquiries, successful advertising, and strong domestic demand as key factors for expected growth.

Supporting this momentum, India’s overall industrial production rose 2.7% in April 2025, according to the Ministry of Statistics. The manufacturing segment grew 3.4%, with 16 out of 23 industry groups reporting increased output.

With inputs from IANS