New Delhi

India’s manufacturing sector showed signs of renewed momentum in January after losing some growth traction towards the end of 2025, with faster increases reported in new orders, output, employment and purchasing activity, according to the HSBC India Manufacturing Purchasing Managers’ Index (PMI) released on Monday.

The seasonally adjusted PMI rose to 55.4 in January from a two-year low of 55.0 in December, indicating an improvement in overall business conditions. A reading above 50 signals expansion.

Survey respondents said demand conditions remained supportive, aided by stronger new business inflows, marketing efforts and continued investment in technology. Production growth accelerated compared to December, reflecting improved order books.

New orders also expanded at a quicker pace after slowing in the previous month, with manufacturers reporting higher demand from both domestic and overseas markets.

The survey noted that input prices increased at the fastest rate in four months, while factory-gate price inflation eased. This resulted in mild pressure on profit margins, the report said.

Commenting on the data, HSBC Chief India Economist Pranjul Bhandari said manufacturing firms experienced a rebound in January, driven by growth in orders, output and hiring. However, she added that business sentiment weakened, with expectations for future output slipping to their lowest level since July 2022.

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The HSBC India Manufacturing PMI is compiled by S&P Global based on responses from around 400 manufacturers and reflects changes in business conditions compared to the previous month.