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| Manufacturing to face the heat of global slowdown
Last Updated: 2009-03-17 10:19:58
Mumbai: Sales in manufacturing sector is likely to witness a slowdown in the quarter ending December on account of steep fall in the commodity prices, a report said.
"Although healthy, we expect the growth in net sales of the manufacturing sector to slow down to 26 per cent in the quarter ending December 2008 compared to 37 per cent in the quarter ended September 08," Centre for Monitoring Indian Economy (CMIE) said in its report.
‘Slowdown throws up opportunities for investment’
The performance of the manufacturing sector is expected to deteriorate on the profit front as well, the report said.
While apparels sector was expected to slip into the red, sector like steel, copper, aluminium, alkalies, edible oils, automobiles and auto components were likely to witness fall in net profits, it said.
Slowdown dents advance tax payments
The expected moderation in growth has been attributed primarily to the steep fall in commodity prices.
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"Due to the lower unit realisation, sectors like edible oils, steel, copper, aluminium are expected to report a slower growth in sales in the December quarter," the report said.
"We expect the manufacturing sector to continue to grapple with the problem of high raw material costs, while the sharp rise in the cost of borrowings amid the current liquidity crunch is also expected to hamper their profitability," CMIE said.
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