MACRO MATTERS.
India's GDP Numbers - The Detailed Picture
India’s GDP for Q1FY23 grew by 13.5% Y-o-Y as against consensus of 15%, helped by a favorable base effect. Although, as compared to pre-covid levels of June-19, GDP is up by only 1.3% on 3Y CAGR basis
Capex gathers steam as share of Gross Fixed Capital Formation in Real GDP marked a 38 quarter high of 34.7%
Private consumption, despite sluggish rural demand, shows a sharp increase of 29.5% Y-o-Y suggesting robust urban demand
On the expenditure side, Govt spending disappointed with a 3Y CAGR growth of mere 3%
Amidst high commodity prices, inflationary pressure and sticky oil prices, import’s share in the GDP remained elevated at 31% in Q1FY23
GDP also weighed down by sluggish exports due to weak global demand. The external sector lag going forward will depend on global demand, inflation & oil prices
While few key sectors that posted a strong double-digit y-o-y growth i.e. 1) Construction and 2) Trade, Hotels and Communication, are either marginally ahead or lagging behind pre-pandemic levels of June-19
Despite slow growth, India is in bright spot as compared to other nations on the back of strong economic recovery. The same can be inferred from the below graph