NEW DELHI: India's services sector growth slowed slightly in April, but new business and output growth remained strong and the fastest in 14 years on favorable economic conditions and strong demand, a monthly survey showed on Monday. .
The seasonally adjusted HSBC India Services Business Activity Index fell to 60.8 in April from 61.2 in March, one of the strongest growth rates seen in less than 14 years.
Survey members attributed the latest increase in output to favorable economic conditions, the strength of demand and increased demand for new work.
In Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion, while a score below 50 indicates contraction.
"India's services activity grew at a slightly slower pace in April due to a further increase in new orders coupled with notable strength in domestic demand," said Pranjul Bhandari, chief India economist at HSBC.,
In addition to the surge in domestic demand, the companies achieved new trading gains in many parts of the world, which collectively underpinned the second fastest surge in international sales since the series began in September 2014.
On the jobs front, amid rising inflow of new business, some service providers in India showed increased interest for new hires in April. However, many companies indicated that payroll numbers were adequate for current needs, and the rate of job creation was modest and softer than at the end of the previous fiscal year.
"In response to rising new orders, companies expanded their employee levels, although the pace of hiring growth slowed," Bhandari said.
On the price front, wage pressures and higher food prices led to a further increase in cost burden, which companies partly passed on to their customers.“Input costs continued to rise rapidly, albeit slower than in March, but this resulted in lower margins for service companies as only a portion of the price increase was passed on to customers through output charges,” Bhandari said. Was."
Meanwhile, service providers' confidence in the year-ahead outlook for business activity rose to a three-month high.
The survey said increased marketing efforts and efficiency as well as competitive pricing plans and predictions of favorable demand conditions have boosted optimism.
Meanwhile, the HSBC India Composite PMI Output Index declined to 61.5 in April from 61.8 in March, the latest reading was one of the highest seen in the last 14 years and indicates a substantial rate of expansion in the private sector.
"In terms of overall activity, total output in both the manufacturing and services sectors expanded significantly in April, albeit at a slightly slower pace, indicating continued health in these sectors," Bhandari said.,
During April, manufacturers reported stronger growth in business penetration than service providers. Total sales grew rapidly and at one of the fastest rates since the mid-2010s.
The composite PMI index is a weighted average of comparable manufacturing and services PMI indices. The weights reflect the relative sizes of the manufacturing and service sectors according to official GDP data.
The seasonally adjusted HSBC India Services Business Activity Index fell to 60.8 in April from 61.2 in March, one of the strongest growth rates seen in less than 14 years.
Survey members attributed the latest increase in output to favorable economic conditions, the strength of demand and increased demand for new work.
In Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion, while a score below 50 indicates contraction.
"India's services activity grew at a slightly slower pace in April due to a further increase in new orders coupled with notable strength in domestic demand," said Pranjul Bhandari, chief India economist at HSBC.,
In addition to the surge in domestic demand, the companies achieved new trading gains in many parts of the world, which collectively underpinned the second fastest surge in international sales since the series began in September 2014.
On the jobs front, amid rising inflow of new business, some service providers in India showed increased interest for new hires in April. However, many companies indicated that payroll numbers were adequate for current needs, and the rate of job creation was modest and softer than at the end of the previous fiscal year.
"In response to rising new orders, companies expanded their employee levels, although the pace of hiring growth slowed," Bhandari said.
On the price front, wage pressures and higher food prices led to a further increase in cost burden, which companies partly passed on to their customers.“Input costs continued to rise rapidly, albeit slower than in March, but this resulted in lower margins for service companies as only a portion of the price increase was passed on to customers through output charges,” Bhandari said. Was."
Meanwhile, service providers' confidence in the year-ahead outlook for business activity rose to a three-month high.
The survey said increased marketing efforts and efficiency as well as competitive pricing plans and predictions of favorable demand conditions have boosted optimism.
Meanwhile, the HSBC India Composite PMI Output Index declined to 61.5 in April from 61.8 in March, the latest reading was one of the highest seen in the last 14 years and indicates a substantial rate of expansion in the private sector.
"In terms of overall activity, total output in both the manufacturing and services sectors expanded significantly in April, albeit at a slightly slower pace, indicating continued health in these sectors," Bhandari said.,
During April, manufacturers reported stronger growth in business penetration than service providers. Total sales grew rapidly and at one of the fastest rates since the mid-2010s.
The composite PMI index is a weighted average of comparable manufacturing and services PMI indices. The weights reflect the relative sizes of the manufacturing and service sectors according to official GDP data.
