India’s manufacturing firms recorded a 6% sales growth in FY25, up from 3.5% last year, led by strong performances in automobiles, food, and pharma sectors, according to Reserve Bank of India (RBI) data. However, input cost pressures impacted operating profit margins.
India’s central bank, the Reserve Bank of India (RBI), reported a 6% rise in sales for listed manufacturing companies during the financial year 2024–25. This marked a significant improvement compared to the 3.5% growth recorded in the previous fiscal year.
The data, compiled from 3,902 listed non-government non-financial companies, highlighted that the growth was primarily led by strong performances in the automobiles, electrical machinery, food and beverages, and pharmaceuticals industries. In contrast, the petroleum and iron & steel sectors experienced a decline in sales.
In the broader scope, sales growth for listed private non-financial companies improved to 7.2% from 4.7% last year, reflecting robust activity in several segments despite global economic headwinds.
The Information Technology (IT) sector saw its sales growth increase to 7.1%, up from 5.5% in the previous year. Non-IT services companies also showed strength, with double-digit growth driven by telecommunication, transport and storage, and wholesale and retail trade industries.
RBI’s report also noted that manufacturing firms faced rising input costs. Raw material expenses grew by 6.6%, and the raw material-to-sales ratio climbed from 54.2% to 55.7%, indicating mounting cost pressures. Consequently, operating profit growth for manufacturing firms moderated to 6%, compared to 12.4% in FY24.
Staff costs increased across sectors, with a 10% rise for manufacturing firms, 4.4% for IT, and 12% for non-IT services companies. While the staff cost-to-sales ratio remained steady in manufacturing, it showed some easing in services sectors.
Operating profit margins were also affected, falling by 20 basis points (bps) for manufacturing (to 14.2%), 80 bps for IT (to 21.9%), and 30 bps for non-IT services (to 22.1%).
The report underscores a year of mixed outcomes for India’s corporate sector—showcasing resilience in some industries while exposing vulnerabilities to rising costs in others.
