The HSBC Flash India Composite Purchasing Managers Index (PMI) rose to 56.5 in September from 54.3 in August. The reading was 61.9 in September 2025. A reading above 50 signals expansion and one below indicates contraction.
Business confidence among firms about the year ahead also increased to a four-month high in September. “Activity in the private sector gained momentum, led by stronger manufacturing,” said Pranjul Bhandari, chief India economist at HSBC.
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Manufacturing PMI climbed to a seven-month high of 55.7 in September from 52.8 in August, while services activity increased to 55.8 from 54.1. Demand strengthened across both manufacturing and services, with manufacturing recording a higher increase. Sales growth also remained stronger among manufacturers than service providers, reaching a seven-month high.
Service providers mentioned marketing efforts helped boost new orders, with firms reporting stronger demand for property-related services, transport and new travel bookings. There was also increased client interest for software and digital solutions. Manufacturers, meanwhile, reported stronger demand for aluminium products, electronic goods, food, pharmaceuticals, and new product models.
ET BureauManufacturing activity improved in September, supported by robust growth in output and new orders. Input purchases increased at the fastest rate since February, while the stocks of finished goods index rose to an 11-and-a-half-year high. “Renewed tensions in the Middle East have once again led firms to build buffers to manage the uncertainties,” said Bhandari.
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Exports, cost pressures
Export orders continued to expand, but the pace of growth slowed from August and was the weakest in around three years, driven primarily by weaker growth among services firms as manufacturers recorded a marginally stronger increase in new export business.