HSBC Flash India PMI®
The HSBC Flash India PMI data for September 2026 indicates a significant strengthening of growth momentum in India's private sector economy at the end of the second fiscal quarter. The Composite Output Index rose to 56.5 in September from August's final reading of 54.3, representing the most pronounced expansion since June and moving back above its long-run average.
Manufacturing led the upturn with the Manufacturing PMI registering 55.7 compared to 52.8 in August, marking the best improvement in sector health for seven months. The Manufacturing Output Index reached 58.2 (up from 54.8 in August), while the Services Business Activity Index improved to 55.8 from 54.1. Both sectors recorded faster output growth, with goods producers showing particularly strong performance.
New orders accelerated across the private sector, with manufacturing sales growth hitting a seven-month high and remaining above services sector performance. Service providers attributed stronger demand to marketing efforts, particularly for properties, transport services, new travel bookings, software, and digital solutions. Manufacturers reported strengthening demand for aluminum products, electronic items, food, pharmaceutical goods, and new models. New export orders continued to rise but at the weakest pace in nearly three years, with services firms showing slower growth while manufacturers saw marginally stronger foreign demand from Brazil, Europe, UAE, and US.
Employment rose solidly in September with job creation recorded in both manufacturing and services sectors at broadly similar rates of expansion. Companies added to staffing capacity amid sustained growth of output and new orders. Outstanding business levels saw a marginal uptick at the composite level following declines in the previous two months, though both sectors signaled only mild pressure on operating capacities.
Input cost inflation across the private sector eased to its lowest mark since January, with softer cost pressures at services companies more than offsetting a pick-up among manufacturers. Companies attributed increased cost burdens to greater outlays on electrical components, foodstuff, fuel, metals, pharmaceutical ingredients, and technology resources. Selling price inflation was broadly unchanged at the composite level, with a stronger increase in factory gate charges contrasting with a weaker rise in services prices.
Business confidence regarding the year-ahead outlook improved in September, with sentiment strengthening at both manufacturers and service providers to reach a four-month high. Manufacturers specifically showed increased activity in building buffers due to renewed Middle East tensions, with input purchases picking up pace and stocks of finished goods reaching an 11.5-year high.
The data was collected between 7-18 September 2026 from survey panels of approximately 400 manufacturers and 400 service providers, representing about 80-90% of total responses for the flash estimate. The services sector coverage includes consumer (excluding retail), transport, information, communication, finance, insurance, real estate, and business services.