Karachi, November 19, 2021 (PPI-OT): 1QFY22 LSM growth clocks in at 5.15%

For the fifteenth month in a row, large-scale manufacturing (LSM) showed a YoY improvement, albeit rising by only 1.2% in Sep-2021. For 1QFY22, LSM growth clocked in at 5.15%.

Key categories of LSM which contributed most significantly during Sep-2021 were Automobiles, Iron and Steel, Coke and Petroleum and Paper and Board, cumulatively contributing ~18% weight to the total index. However, during 1QFY22, leading contribution came from Automobiles, Pharmaceuticals, Food and Beverages, Paper and Board and Iron and Steel.

The low base has largely waned and growth from here onwards would be a key challenge amid spike in LSM Index post Sep-2020, that has now set a higher base.

LSM growth is expected to likely stay positive in the remaining quarters of FY22 except 3Q, considering the high base during 3QFY21. However, impact of TERF on capacity expansions is yet to be reflected, which may likely support the forthcoming LSM growth numbers.