India's Q3 GDP numbers to be released today: Will it be better than Q2? Check experts' views

India’s economy is expected to grow in the range of 6.2-6.4% with a seasonal pick-up in some consumer-led sectors during the festive period and healthy trends in kharif output aiding rural consumption demand.

The National Statistics Office (NSO) will declare both FY2024-25 GDP as well as Q3 GDP estimates on Friday, February 28, at 4 pm.

India's GDP growth slowed to 5.4% in the July-September quarter of FY25, down from 8.1% in the same period last year.

“Despite upheavals in global geopolitics and trade/supply chains being susceptible to winds of re-globalisation, the Indian economy has been leaning against the winds,” said State Bank of India (SBI) in its report. Leading indicators show strong upward movement across all domains, including consumer economy, investment demand, industry, and services – signalling robust momentum, it further said.

GDP growth as per the SBI composite leading indicator (CLI) index (a basket of 36 leading indicators which includes parameters from almost all the sectors) based on monthly data shows a slight uptick in economic activity in Q3. This increase in economic activity in Q3FY25 indicates GDP may grow in the range of 6.2-6.3%.

Ratings firm ICRA estimates GDP growth to rise to 6.4% in Q3 FY2025 from the seven-quarter low of 5.4% in Q2, while printing below the 6.7% expansion seen in Q1 FY2025. “Based on these initial estimates, GDP growth is projected at 6.4% in FY2025, entailing a further acceleration in Q4 FY2025 underpinned by hopes of ramping up of government spending and project execution and seasonally healthy exports amid sustained rural consumption,” it said in a statement.

However, the International Monetary Fund (IMF) expects India's real GDP to grow at 6.5% in 2024-25 and 2025-26 on robust growth in private consumption on the back of sustained economic and financial stability.

India’s economic activity improved in Q3 FY2025, with the seasonal pick-up in some consumer-led sectors during the festive period, healthy trends in kharif output aiding rural consumption demand, as well as some recovery in mining and electricity sectors after the withdrawal of monsoons.

For FY2026, ICRA has placed the baseline assumption for GDP and GVA growth at 6.5% and 6.3%, respectively, amid a likely uptick in domestic consumption and investment, aided by favourable announcements in the Union budget for FY26.

India’s Index of Industrial Production (IIP) manufacturing growth improved to 4.3% in Q3 FY25 from 3.3% in Q2 FY25, and the SBI Index is also showing positive momentum in Q3.

ICRA expects the CPI inflation to soften to ~4.2% in FY2026 from an estimated 4.8% in FY2025. With February 2025 CPI inflation projected to ease to 4.0% (MPC's medium-term target), the odds for another rate cut of 25 bps in April 2025 policy have risen. Nevertheless, incoming data on growth and inflation, global developments, and the USD/INR trends would also play a role in the timing of the rate action.

The Q3FY25 earnings season presented a modest growth story, with corporate profits facing headwinds but showing resilience in key sectors. The Nifty50 recorded just 3.1% YoY adjusted PAT growth for Q3FY25, starkly contrasting the robust double-digit PAT growth seen during FY24. A similar trend was seen for BSE500, where Q3 saw single-digit growth, which was in contrast with the double-digit growth seen during FY24.

On a more encouraging note, after two consecutive quarters of negative earnings growth, Q3FY25 saw a return to positive PAT growth. Overall EBITDA margins improved, reflecting better pricing and cost focus.

Meanwhile, the Reserve Bank is likely to deliver another rate cut of 25 basis points at the upcoming review of the monetary policy in April to help growth.

Minutes of the last policy reveal that all the members on the six-member monetary policy panel feel that rates remained at restrictive levels, it said. After the April rate cut, RBI will focus more on the liquidity measures to ensure transmission of the 0.50% repo rate cut to the real economy, it said, adding that more cuts are unlikely in the current cycle.

The central bank is already cognisant of the liquidity needs, and the recent $10 billion swap announcement is "encouraging", it said.

State Bank of India expects NSO to revise Q1 and Q2 estimates.