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The resurgent industrial production numbers are likely to boost the sentiment in the economy and may also help the Reserve Bank of India go for rate cuts in the near future
New Delhi: Led by a recovery in manufacturing output, industrial production grew by 5.9% in November 2011, after witnessing a contraction in the previous month, a development that may reverse the negative sentiment amid an economic slowdown, reports PTI.
Factory output, as measured by the Index of Industrial Production (IIP), grew by 6.4% in November 2010, as per data released by the government here Thursday.
Meanwhile, the IIP figure for October 2011 has been revised. The latest data indicates a 4.74% contraction in industrial output during the month against the provisional estimate of a 5.1% decline in production.
Output of the manufacturing sector, which constitutes over 75% of the index, went up by 6.6% in November compared to a growth of 6.5% in the same month of 2010.
Power generation grew by robust 14.6% in November 2011 compared to 4.6% in the same month of 2010.
Production of consumer goods also witnessed a 13.1% upswing during the month under review, as against growth of a mere 0.7% in the corresponding month of 2010.
Furthermore, consumer durables production increased by 11.2% compared to a growth of 7.2% in November 2010.
During the month under review, output of consumer non-durables also went up by 14.8%. The segment had declined by 4.4% in November 2010.
However, mining output declined by 4.4% in November this fiscal, as against a growth of 6.9% in the corresponding month a year ago.
Production of capital goods also fell by 4.6% in the month under review. The segment had grown by 25.7% in the corresponding month of 2010.
Meanwhile, basic goods production witnessed 6.3% growth in November 2011 against growth of 5.7% in the same month of 2010.
Production of intermediate goods also rose marginally by 0.2% during the month compared to growth of 4.3% in the year-ago period.
The resurgent industrial production numbers are likely to boost the sentiment in the economy and may also help the Reserve Bank of India (RBI) go for rate cuts in the near future.
India’s economy grew by 6.9% in July-September, 2011, the slowest rate of expansion in nine quarters.
India Inc had attributed the slowdown to rising interest rates, which have led to an increase in the cost of borrowing, thus hindering fresh investment.
The RBI has hiked interest rates 13 times since March 2010 to tame inflation. Headline inflation has been above the 9% mark since December last year.