June core output at 3-month high on steady govt capex
India's core sector shows growth. Output reached a three-month high in June at 1.7%. Government spending on infrastructure supported this growth. Steel and cement production increased. Refinery products also saw gains. However, coal, natural gas, electricity, crude oil, and fertilizers declined. Experts predict further improvement in July. Industrial activity may be impacted.
ANI Representative Image New Delhi: India's core sector output grew to a three-month high of 1.7% in June, driven by sustained government capital expenditure that supported infrastructure-related sectors, even as five of the eight core industries recorded contraction, official data released Monday showed. The growth was 1.2% in May and 5% in June 2024."Steady government capex, along with the reasonable growth in steel, cement and refinery products pulled up the infrastructure output to a three-month high," said Paras Jasrai, associate director at India Ratings and Research (Ind-Ra).The steel output surged to a seven-month high of 9.3% in June, while cement production increased by 9.2%, due to a favourable base effect.
"The growth in volumes of these segments has been quite healthy in Q1FY26, which implies that the construction sector is poised to record a robust GVA (gross value added) growth in the quarter," said Aditi Nayar, chief economist at ICRA. Official GVA figures for the June quarter will be released in August.
Output of refinery products grew to a five-month high of 3.4% year-on-year.The strong performance of these three sectors helped prevent a contraction in core sector output, offsetting decline in other five industries - coal (6.8%), natural gas and electricity (2.8% each), and crude oil and fertilizers (1.2% each)."While an elevated base weighed upon coal output, excess rains in the latter half of June impacted electricity generation," explained Nayar.Jasrai added that the swift progression of the southwest monsoon across the country along with a high base effect were some of the reasons.On average, core sector output averaged 1.3%, lower than 6.2% in the corresponding period last year.Looking ahead, Ind-Ra projects core sector output to improve further to around 2% year-on-year in July.Since the eight core industries account for 40.27% weight in the Index of Industrial Production (IIP), economists expect the tepid growth in core sector output to impact industrial activity as well.Industrial output grew by 1.2% year-on-year in May from 2.6% in April, according to official data released last month. Estimates for June will be released on July 28.Ind-Ra anticipates IIP growth to remain around 1.5% in July, while ICRA expects 1.5-2.5%.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
8 hours ago
- Economic Times
Received approval from board to raise Rs 5,000 cr: Indian Bank MD & CEO
Public sector Indian Bank has received approval from the board to raise Rs 5,000 crore during the financial year, a top official has said. The Chennai-headquartered bank reported a capital adequacy ratio of 17.80 per cent for the April-June 2025 quarter, the bank's Managing Director and CEO Binod Kumar said. "Approval is there. We have to raise Rs 5,000 crore. Not QIP (Qualified Institutional Placement) or by any other instruments. But, I do not think it (fund raise) will be required (immediately). 17.8 per cent (of Capital Adequacy Ratio) is there.., " he told PTI in a brief the April-June 2025 quarter, the Capital Adequacy Ratio of the bank rose to 17.80 per cent from 16.47 per cent recorded in the same quarter of last financial the fund raising plan, the bank is betting big on its UPI related payments proposal, as it is currently working on developing an IND-UPI application, similar to the services provided by PhonePe, GPay or PayTM. Through such an initiative, the bank would be able to save about Rs 150 crore every Kumar said the bank is developing its own UPI app named 'IND-UPI', a UPI-based payment solution similar to the current PhonePe, GPay or PayTM services."Right now, our customers are using other UPI apps and we (Indian Bank) have to pay them a fee. Monthly, it will be around Rs 12 crore. With the IND-UPI payment facility, customers will be able to make payments using our own application and through this we will be able to save Rs 12 crore per month (around Rs 150 crore per annum)", he explained that the application is currently used by the senior officials of the bank as a 'Closed User Group' and it would be rolled out to customers soon after getting the approval from NPCI."By this initiative, we will be able to save a handsome amount. We will be able to pass on the benefits to our own customers like providing incentives whenever they use IND-UPI app to make UPI-transactions," he a query about hiring plans, he replied in the affirmative, stating they have received approval to recruit 3,000 employees during the current financial year across "all levels." "It will be 3,000 people across all levels this year. We are going to do specialised hiring like cyber security, risk specialists, there will be multiple specialised roles," he Bank reported a 24 per cent rise in net profit to Rs 2,973 crore in the April-June 2025 quarter. The bank earned a net profit of Rs 2,403 crore in the corresponding quarter of last financial year."The result is in line because earlier the growth has been a challenge for us. But this quarter we have grown in double digit. Earlier we grew in single digit," he the bank's target for this year under the recoveries segment, he said, "We have given guidance of Rs 5,500 to Rs 6,500 crore for the year. But in this April-June 2025 quarter itself, we have recovered Rs 2,059 crore. It is a good one". The total income of the bank grew to Rs 18,721 crore during the April-June 2025 quarter from Rs 16,945 crore registered in the corresponding quarter of last financial year. PTI
Mint
10 hours ago
- Mint
Received approval from board to raise ₹5,000 cr: Indian Bank MD & CEO
Chennai, Jul 27 (PTI) Public sector Indian Bank has received approval from the board to raise ₹ 5,000 crore during the financial year, a top official has said. The Chennai-headquartered bank reported a capital adequacy ratio of 17.80 per cent for the April-June 2025 quarter, the bank's Managing Director and CEO Binod Kumar said. "Approval is there. We have to raise ₹ 5,000 crore. Not QIP (Qualified Institutional Placement) or by any other instruments. But, I do not think it (fund raise) will be required (immediately). 17.8 per cent (of Capital Adequacy Ratio) is there.., " he told PTI in a brief interaction. During the April-June 2025 quarter, the Capital Adequacy Ratio of the bank rose to 17.80 per cent from 16.47 per cent recorded in the same quarter of last financial year. Besides the fund raising plan, the bank is betting big on its UPI related payments proposal, as it is currently working on developing an IND-UPI application, similar to the services provided by PhonePe, GPay or PayTM. Through such an initiative, the bank would be able to save about ₹ 150 crore every year. Elaborating, Kumar said the bank is developing its own UPI app named 'IND-UPI', a UPI-based payment solution similar to the current PhonePe, GPay or PayTM services. "Right now, our customers are using other UPI apps and we (Indian Bank) have to pay them a fee. Monthly, it will be around ₹ 12 crore. With the IND-UPI payment facility, customers will be able to make payments using our own application and through this we will be able to save ₹ 12 crore per month (around ₹ 150 crore per annum)", he said. Kumar explained that the application is currently used by the senior officials of the bank as a 'Closed User Group' and it would be rolled out to customers soon after getting the approval from NPCI. "By this initiative, we will be able to save a handsome amount. We will be able to pass on the benefits to our own customers like providing incentives whenever they use IND-UPI app to make UPI-transactions," he said. To a query about hiring plans, he replied in the affirmative, stating they have received approval to recruit 3,000 employees during the current financial year across "all levels." "It will be 3,000 people across all levels this year. We are going to do specialised hiring like cyber security, risk specialists, there will be multiple specialised roles," he said. Indian Bank reported a 24 per cent rise in net profit to ₹ 2,973 crore in the April-June 2025 quarter. The bank earned a net profit of ₹ 2,403 crore in the corresponding quarter of last financial year. "The result is in line because earlier the growth has been a challenge for us. But this quarter we have grown in double digit. Earlier we grew in single digit," he said. On the bank's target for this year under the recoveries segment, he said, "We have given guidance of ₹ 5,500 to ₹ 6,500 crore for the year. But in this April-June 2025 quarter itself, we have recovered ₹ 2,059 crore. It is a good one".
&w=3840&q=100)
Business Standard
11 hours ago
- Business Standard
Indian Bank gets board's approval to raise ₹5,000 crore: MD Kumar
Chennai-based Indian Bank has received the board's nod to raise ₹5,000 crore during the current financial year, said the bank's Managing Director and CEO, Binod Kumar. "We have to raise ₹5,000 crore. But, I do not think it (fund raise) will be required (immediately)," he told PTI in an interaction. The bank's top official also told PTI that the capital adequacy ratio for the first quarter (Q1) of financial year (FY) 2025-26 was 17.80 per cent. The bank had reported a 16.47 per cent capital adequacy ratio in Q1 of the previous financial year. He also stated that the funds would not be raised through Qualified Institutional Placement (QIP), which is a process through which listed companies raise capital by issuing shares or securities to qualified institutional buyers (QIBs). The bank is also developing a standalone UPI application named 'IND-UPI'. The app will have features similar to those provided by major UPI mobile applications. "Right now, our customers are using other UPI apps, and we (Indian Bank) have to pay them a fee. Monthly, it will be around ₹12 crore. With the IND-UPI payment facility, customers will be able to make payments using our own application," he said. The bank aims to save around ₹150 crore annually through the IND-UPI application project. The app is in the development phase and is being used by a 'Closed User Group' and plans to roll it out to customers after receiving NPCI's approval. Hiring The CEO also stated that the company has approved the hiring of around 3,000 employees during FY26 across domains like cyber security, risk specialists, and multiple specialised roles. Q1 Results
