India PMI At 59.3 In February, Strongest Growth In 3 Months As Manufacturing Leads

New Delhi: India’s business activity improved further in February, with the HSBC Flash India PMI rising to 59.3, up from 58.4 in January. This marks the strongest growth in three months, according to data compiled by S&P Global.

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A PMI reading above 50 shows expansion. The higher February number means companies across manufacturing and services saw stronger growth in output.

At the overall or composite level, business expansion was the fastest since September last year.

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Manufacturing Drives the Momentum

The main boost came from the manufacturing sector. Factory production increased at a quicker pace, supported by strong domestic demand and a rise in new orders.

Pranjul Bhandari, Chief India Economist at HSBC, said the manufacturing industry strengthened due to solid growth in output and new local orders.

Manufacturers also reported a sharp rise in total sales — the fastest in four months. Companies increased buying of raw materials, with input purchases rising to a four-month high.

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Services Sector Stable but Slower

Growth in the services sector remained steady compared to the start of 2026, but it slowed slightly. New orders in services rose at the weakest pace in 13 months.

Competitive pressure and cheaper services offered elsewhere affected growth in this segment.

However, services outperformed manufacturing in exports. International orders in services rose sharply, marking the strongest growth since August 2025.

Hiring Improves, Inflation Pressures Rise

With demand improving, private sector companies hired more staff and increased production. Businesses also became more confident about future growth.

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At the same time, inflation pressures increased. Input costs and selling prices both rose at faster rates in February.

Despite rising costs, suppliers were able to deliver materials on time. Vendor performance has been improving for nearly two years, helping companies maintain healthy stock levels.

Overall, February’s data shows strong domestic demand and improving business confidence, even as inflation pressures remain a concern.

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