The MSME business expectation index (M-BEI) projects consistent optimism for the next four quarters, with indices above 60 and manufacturing even above 70, reflecting bullish sentiment on parameters like sales, profitability and expectations of improved availability of skilled labour, access to finance and overall business situation, a SIDBI release said.
Indian MSMEs are optimistic on sales growth, buoyed by positive sentiment on order books, production and rise in selling price. Their assessment about the sales performance in Q3 FY25, however, was lukewarm, skewed by the weak performance reported by majority of trading units.
Respondents in the manufacturing sector are expecting rise in input costs. However, with higher production quantity and increase in average selling price, about half of them expect to increase the profit margin a year ahead, the survey revealed.
About a sixth of the respondents in all sectors were not happy with the labour productivity and availability of skilled labour. However, they expect the same to improve in the year ahead.
Employment scenario was broadly steady in Q3 FY25, with 62 per cent of respondents having left their employee strength unchanged. The expectations on the future, however, are bullish with 30-40 per cent planning to raise their workforce. The optimism is more pronounced in the manufacturing sector.
MSMEs are pinning their hopes on the Indian financial system. About one third of the MSME respondents are optimistic that their rising working capital requirement will be met adequately by financial institutions.
The share of responses in favour of adoption of digital modes for selling and marketing is rising steadily.
The share of positive responses towards willingness to invest in environmental protection measures and adopting new technologies is rising as well. Respondents in the manufacturing sector are most willing for the change with about 46 per cent positive responses for Q3 FY25.
Optimism towards access to infrastructure, supply of electricity and time and efforts to obtain permits and clearances is increasing among participants from all sectors.
ALCHEMPro News Desk (DS)
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