Today, the Reserve Bank released the results of its 66th round of the quarterly Order Books, Inventories, and Capacity Utilisation Survey (OBICUS), which was conducted during Q2:2024-25 and covered 905 manufacturing companies. The survey¹ provides a snapshot of the demand conditions in India’s manufacturing sector during April-June 2024.

Highlights:

• At the aggregate level, capacity utilisation (CU) in the manufacturing sector recorded a seasonal decline to 74.0 per cent in Q1:2024-25 from 76.8 per cent in the previous quarter. The seasonally adjusted CU (CU-SA) increased by 120 basis points over this period to 75.8 per cent (Chart 1 and Table 1).

• Respondents reported an increase in growth of new orders received during Q1:2024-25 on an annual (y-o-y) basis, even as they recorded seasonal decline on a sequential (q-o-q) basis (Chart 2 and Table 2A).

• As a ratio to sales, both the finished goods inventory (FGI) and the raw material inventory² (RMI) remained stable during Q1:2024-25 (Chart 3 and Table 3A).

Note - Please see the excel file for time series data.

ANNEX 1: Data Tables

Note: The methodology for computations of order book growth and inventory to sales ratios is given in the RBI press release dated October 8, 2021 (link: https://www.rbi.org.in/Scripts/PublicationsView.aspx?id=20650). Please also see footnote 2 on direct estimation of RMI since 53rd round of the survey.

¹ The survey responses are voluntary, and the results reflect the views of the respondents, which are not necessarily shared by the Reserve Bank. Results of the previous survey round were released on the Bank’s website on August 08, 2024.

² The estimates of raw materials inventory (including stores and spares, loose tools, stock-in-trade and other inventories) were arrived at by netting out finished goods inventory and work-in-progress inventory from total inventory. Since the 53rd round of the survey (i.e., Q4:2020−21), however, direct data on raw material inventory (excluding stores and spares, loose tools, stock-in-trade and other inventories) are also being collected from survey respondents, in parallel. Estimates of raw materials inventory based on the additional reporting are presented here.