Reg| Perspective on the IIP numbers by Mr. Nikhil Gupta, Chief Economist at Motilal Oswal Financial Serv

Kindly find appended perspective on the IIP numbers by Mr. Nikhil Gupta, Chief Economist at Motilal Oswal Financial Services.

Third consecutive high double digit IIP d

-- IIP contracted 34.7% YoY in May’20 broadly in line with our expectation of ~38ecline in May’20

 % and v/s a decline of 57.6% in Apr'20. 

-- Just like in previous two months, the decline in IIP was led by across-the-board contraction in all the major components.

-- While mining activities fell ~21%, manufacturing sector declined ~39.3%, lower than our forecast of ~43%.

-- Infrastructure/construction activities and capital goods production still declined in the range of 40-60% and consumer durables contracted more than two-thirds in May'20.

-- Going ahead, while Jun’20 appears to be a far better month, we expect IIP to continue declining for another 3-4 months. Jun'20 IIP is likely to have contracted by another 20-30%.