The year-on-year (YoY) growth in economic activity, as measured by the ICRA Business Activity Monitor - an Index of high frequency indicators, rose to a 6-month high of 8.5% in September 2025 from 8.0% in August 2025, led by the early onset of the festive season and GST rationalisation. However, excess rains impacted mining and energy-related indicators, which halved the growth of core output to 3.0% in September from the 15-month high of 6.5% in August 2025. Given this, ICRA expects the IIP growth to dip to ~2.0% in the month from 4.0% in August 2025. In quarterly terms, the growth in the ICRA Business Activity Monitor improved to 8.2% in Q2 FY2026 from 7.2% in Q1 FY2026.

? Growth in ICRA Business Activity Monitor at 6-month high in September 2025: The YoY growth in the Index rose to a 6-month high of 8.5% in September 2025 (+7.7% in September 2024) from 8.0% in August 2025 (+5.8% in August 2024). 

? Core output growth halved to 3.0% in September 2025 from 6.3% in August 2025: As many as seven of the eight sectors (barring steel) reported a deterioration in their growth performance between these months, with the mining and electricity sectors weighed down by excess rains in the month.

EXHIBIT: Level of ICRA Business Activity Monitor (FY2019=100)

For details on the construction of the ICRA Business Activity Monitor, please refer to the Annexure A.1; Source: ICRA Research