Industrial Outlook Survey of the Manufacturing Sector for Q2:2026-27

Today, the Reserve Bank released the results of 115th round of its quarterly industrial outlook survey (IOS). The survey 1 encapsulates qualitative assessment of the business climate by Indian manufacturing companies for Q2:2026-27 and their expectations for Q3:2026-27 as well as outlook on select parameters for the subsequent two quarters. A total of 1,224 companies responded in this round of the survey 2 conducted during July-September 2026. Highlights: A. Assessment for Q2:2026-27 Manufacturers indicated improved demand conditions as compared to the previous quarter, as reflected in their assessment on production, order books and capacity utilisation ( Table A ). Pressures from raw material costs remained elevated, while sentiments on selling prices showed moderation. The Business Assessment Index (BAI) improved to 104.4 in Q2:2026‑27, up from 100.4 in Q1:2026‑27 ( Chart 1 ). B. Expectations for Q3:2026-27 Firms remained optimistic on demand conditions in Q3:2026-27, with improvement in production, order books, capacity utilisation and exports. Cost pressures are anticipated to remain elevated and so are the sentiments on selling prices and profit margins. Business expectations

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