Industrial Output Quickens to 1.5% in June 2025 India’s industrial output rose 1.5% yearonyear in June 2025, improving from a revised 1.2% in May, according to official figures from the Ministry of Statistics and Programme Implementation (MoSPI). While modest, this acceleration signals a tentative return of momentum in industrial activity.
Sector highlights: Manufacturing – the heaviest weight within the IIP – grew by 3.9% in June, up from 3.2% in May. Mining contracted sharply by 8.7%, worse than May’s marginal fall of 0.1%. Electricity generation fell by 2.6%, an improvement from May’s 4.7% drop. Consumer durables rebounded (+2.9%), reversing a decline in the previous month, while non-durables still fell (0.4%). Meanwhile, the overall infrastructure (core) sector—which forms around 40% of industrial output—grew at 1.7% yearonyear in June, the fastest pace in three months, up from a revised 1.2% in May. Supported by a resilient PMI reading (58.4 in June, a 14month high) and rising export orders, manufacturers showed robust output and hiring momentum. Despite the uptick, the broader picture remains cautious. The April–June (Q1 FY26) industrial output growth came in at about 2%, significantly lower than last year’s 5.4% during the same quarter.
How This May Impact the Indian Stock Market
1. Sectoral Stocks Manufacturing plays: Auto, capital goods, consumer durables, and engineering firms could see positive investor sentiment as durable goods and export orders rise. Infrarelated stocks: Cement, steel, and refinery companies may benefit from infrastructure-sector rebound (cement +9.2%, steel +9.3%, refinery +3.4%). Weakness areas: Mining and utilities stocks may underperform, given sharp contraction in mining (8.7%) and electricity output (2.6%). 2. Macro & Policy Sentiment Sluggish industrial growth could temper expectations of aggressive interest rate cuts from the RBI. However, stable inflation and rising PMI may keep the door open for moderate easing if momentum continues. Government capital expenditure trends could support infrastructure firms and cyclical investments, but private capex remains muted. 3. Market Indices & Outlook Broader indices like the Nifty or Sensex may respond positively to manufacturing and export-oriented strength, especially if sentiment around Q2 FY26 improves. Market volatility may persist if sectors lag or global growth slows, but the modest recovery in industrial activity provides a constructive near-term tone.
Summary India’s industrial output grew at 1.5% yearonyear in June 2025, marking a modest recovery from May’s low of 1.2%, led by manufacturing and core infrastructure sectors. Mixed signals persist—with mining and electricity lagging, while PMI data, durable goods, exports, and infrastructure segments offer optimism. For the stock market, manufacturing and infrastructure names may benefit, while utilities and mining face pressure. Overall, the data lends cautious support to continued economic rebuilding,
though growth challenges remain. By Nehal Taparia This content is for educational and knowledge purposes only and should not be considered as investment or Trading advice. Please consult a certified financial advisor before making any investment or Trading decisions.
