Below are Views On IIP beats expectations: Grows 3.6% YoY in Oct'20 By Mr. Nikhil Gupta, Chief Economist at Motilal Oswal Financial Services

IIP beats expectations: Grows 3.6% YoY in Oct'20

-- Better than both our estimate of 0.8% and market consensus of 1.0%, IIP growth climbed up to 3.6% YoY in Oct'20 from only 0.5% a month ago and -6.6% in Oct'19. This was led by a turnaround in manufacturing activities in Oct'20.

-- While power generation grew double digits, mining activities continued to see contraction in Oct'20.

-- Capital good production grew for the first time in 24 months in Oct'20 and infrastructure/construction activities grew at the fastest pace in 22 months.

-- Consumer goods production too grew >10% YoY in Oct'20, supported by both durables and non-durables.

Overall, better-than-expected growth in IIP in Oct'20 might have just been a case of high festive demand and whether the growth momentum continues is yet to be seen. In any case, we don't expect RBI to cut rates anytime soon

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