June 2025 IIP at 1.52%; manufacturing stands tall

29 Jul 2025 , 12:08 PM

JUNE 2025 IIP AT 1.52%; MANUFACTURING SHINES

IIP growth for June 2025 was tepid at 1.52%. The good news is that, May IIP has been revised sharply up by 64 bps from 1.23% to 1.87%. This raises the possibility of June IIP also being revised upwards. However, June 2025 IIP growth disappointed at 1.52%, despite a favourable base effect; with IIP growth falling from 6.25% in May-24 to 4.93% in Jun-24.

In terms of yoy IIP growth, mining contracted by -8.7%, largely due to monsoon impact. Manufacturing IIP improved from 3.2% to 3.9% over previous month. Electricity IIP improved from -4.7% to -2.6%, but stayed in contraction mode. Quarterly IIP growth overall stood at 1.98%; with mining and electricity contracting; and manufacturing positive.

High frequency MOM IIP showed short term pressure. For June 2025, the MOM mining contracted sharply by -9.68%, manufacturing contracted -1.87%, while electricity also contracted -0.64%. As a result, overall IIP also contracted by -2.73% MOM. Despite domestic confidence, global constraints remain an overhang on output growth.

IIP GROWTH STORY IN LAST 1 YEAR

Despite being positive post August 2024, IIP has become very volatile of late.

Month	IIP Growth (%)
Jun-24	4.93%
Jul-24	4.98%
Aug-24	0.00%
Sep-24	3.23%
Oct-24	3.73%
Nov-24	4.96%
Dec-24	3.74%
Jan-25	5.21%
Feb-25	2.72%
Mar-25	3.94%
Apr-25	2.57%
May-25	1.87%
Jun-25	1.52%

Data Source: MOSPI

The tepid IIP of 1.52% in June 2025 is despite the favourable base effect, which shows pressure. Most of this pressure is coming from mining and electricity. The last time, IIP growth was under 2% for 2 months in a row was in Jan-22 and Feb-22.  If you look at IIP growth in previous 12 months, it averaged 3.49%, while it averaged 3.34% in last 6 months. Median IIP is converging to the 3.5% level; although current levels are sharply lower.

JUNE 2025 IIP: DISSECTING IIP PRODUCT BASKET

The table captures comparative IIP growth for last 3 months, with respective components.

Product Basket	Weights	Apr-25	May-25	Jun-25
Manufacture of food products	5.3025	1.1	1.7	0.0
Manufacture of beverages	1.0354	-1.5	-3.7	-6.5
Manufacture of tobacco products	0.7985	23.9	5.7	2.3
Manufacture of textiles	3.2913	0.4	-3.0	1.2
Manufacture of wearing apparel	1.3225	8.7	2.3	4.2
Manufacture of leather products	0.5021	-1.0	-4.6	-3.1
Manufacture of wood products	0.1930	24.6	2.1	0.7
Manufacture of paper products	0.8724	-2.5	-4.4	-2.1
Printing and recorded media	0.6798	-8.3	-16.1	-12.9
Manufacture of coke and refined petroleum	11.7749	-2.1	1.1	4.2
Manufacture of chemical products	7.8730	-4.1	-4.0	-3.6
Manufacture of pharmaceuticals	4.9810	-5.3	-0.6	2.1
Manufacture of rubber and plastics	2.4222	7.4	8.4	-0.5
Manufacture of other non-metallic minerals	4.0853	5.4	6.9	3.8
Manufacture of basic metals	12.8043	6.8	7.8	9.6
Manufacture of fabricated metal products	2.6549	10.7	-0.1	15.2
Manufacture of computer, electronic	1.5704	10.6	-4.9	-1.3
Manufacture of electrical equipment	2.9983	14.0	7.8	6.4
Manufacture of machinery and equipment	4.7653	9.5	10.6	4.2
Manufacture of motor vehicles, trailers	4.8573	16.0	6.2	4.7
Manufacture of other transport equipment	1.7763	-0.8	6.5	0.5
Manufacture of furniture	0.1311	1.3	-5.7	10.3
Other manufacturing	0.9415	-20.0	-15.3	-17.6
MINING	14.3725	-0.2	-0.1	-8.7
MANUFACTURING	77.6332	3.1	3.2	3.9
ELECTRICITY	7.9943	1.7	-4.7	-2.6
OVERALL IIP	100.0000	2.6	1.9	1.5

Data Source: MOSPI

Let us first look at the positive drivers of IIP growth. The positive thrust came largely from sectors like Fabricated Metal Products, Furniture, Basic Metals, Electrical Equipment, Motor Vehicles, Wearing Apparel, Coke & Refined Petroleum Products, and machinery & equipment. These 8 sectors averaged 7.4% IIP growth in June 2025.

The negative pressure on IIP came from Other Manufacturing, Printing & Recorded Media, Beverages, Chemicals, leather products, paper products, and computer electronics. These 7 products averaged -6.7% in June 2025. The picture looks a lot more mixed as there are export oriented sectors in big gainers and big losers. Global constraints are becoming less significant as a driving factor of IIP!