Mr. Dhiraj Relli, MD & CEO, HDFC securities views on Q3FY21 GDP Growth Number
(Time Zone: Arizona, USA)
The Q3 GDP growth number at 0.4% is lower than our estimates of 0.8% but quite short of some other estimates which were in the range of 1.4-2%. The GVA growth of 1% is however a little ahead of our estimates of 0.7.
While construction growth has pleasantly surprised, the growth of private final consumption, Govt final consumption and industry disappointed. The variance of the GDP growth number with the buoyant corporate profits, GST collections and other high frequency indicators data needs more scrutiny. The informal sector of India accounting for a large portion of the GVA still does not seem to have come out of pain but the recent Govt measures may play a role in alleviating some of their problems.
The downward revision of FY21 GDP in the second advance estimates to -8% is also a bit disappointing.
The equity markets may be a tad disappointed with these data points but the mood at this point is anyway somber.
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