SBI pegs India’s Q3FY25 GDP growth at 6.2%-6.3%

The Economic department of State Bank of India (SBI) has pegged India’s Gross Domestic Product (GDP) growth for Q3 FY25 at 6.2% to 6.3%.

“Impinging upon our in-house developed ‘Nowcasting Model’ that leverages 36 high frequency indicators, we estimate the GDP growth for Q3 FY25 should come around 6.2%-6.3% (data due on 28th February),” said SBI in a Special Research Report on Wednesday.

The RBI had in December projected the Q3 FY25 GDP growth rate at 6.8%.

“Presuming no major revisions announced in the erstwhile Q1 and Q2 figures by National Statistical Office (NSO), we estimate the FY25 full year GDP at 6.3%,” it said.

At the last MPC meeting earlier this month the RBI had projected the FY25 GDP growth at 6.4%.

Stating that the percentage of indicators showing acceleration has increased to 74% in Q3FY25 vs 71% in Q2FY25, it said a healthy rural economy is further reinforcing stability and sustains momentum in other sectors even as rural agriculture wage growth is consistent and domestic tractor sales and rabi crop sown have picked up momentum.

It said the slowdown in current household inflation expectations encourages higher discretionary spending and drives demand-led growth. 

“Moderation in declining consumer confidence suggests that households are now optimistic about global developments, disinflation process, and economic prospects – enabling long-term sustainable growth,” it stated. 

“CAPEX is showing improvement in Q3 FY25 with majority of the states’ capex as % of Budget Estimate (BE) being lower in FY25 on date but embracing a momentum in Q3 FY25 which augurs well for future developments,” it said. 

“IIP [Index of Industrial Production] manufacturing growth has improved from 3.3% in Q2 FY25 to 4.3 % in Q3 FY25 and SBI Index also showing positive momentum in Q3,” it added. 

According to SBI, India Inc. has reported positive EBIDTA growth/margins (44 bps) after two quarters, while Corporate GVA has improved substantially (QoQ).

About 4000 Corporate in listed space reported revenue growth of 6.2% while EBIDTA and profit after tax (PAT) grew by around 11% and 12% respectively in Q3FY25 as compared to Q3FY24, it said. 

“What is pertinent to mention is the same set of corporate reported EBIDTA growth of around 5% in Q3FY25 as compared to negative EBIDTA growth in last two quarters of FY25,” it said. 

At aggregate level, EBIDTA margin improved by around 44 bps in Q3FY25 to 14.84% from 14.4% in Q2FY25. Corporate GVA improved by around 300 bps in Q3FY25 (YoY).