MNI India Consumer Report 2014-04

MNI India Consumer Report April 2014

Insight and data for better decisions

MNI India Consumer Report - April 20142

About MNI Indicators Insight and data for better decisions

MNI Indicators offers unique macro-economic data and insight to businesses and the investment community. We produce data and intelligence that is unbiased, pertinent and responsive. Our data moves markets.

Specialising in business and consumer focused macro-economic reports, we give our customers the ability to make timely and relevant decisions. We strive to provide up-to-date information on business and consumer confidence on the economy.

MNI Indicators publishes data on a monthly basis. Our indicators are based on a unique and proprietary methodology and are designed to present an advance picture of the economic landscape as perceived by businesses and consumers every month.

Our monthly reports explore attitudes, perspectives and confidence across different countries and regions. They deliver in-depth analysis, highlight changing patterns and how these can affect potential developments in business and consumer activities.

MNI Indicators is part of MNI, a leading provider of news and intelligence. MNI is a wholly owned subsidiary of Deutsche Börse Group, one of the largest worldwide exchange organisations.

Written and researched byPhilip Uglow, Chief EconomistShaily Mittal, Economist

MNI Indicators | Deutsche Börse Group Westferry House11 Westferry CircusLondon E14 4HETel: +44 (0)20 7862 7444Email: [email protected]

www.mni-indicators.com@MNIIndicators

Copyright© 2014 MNI Indicators | Deutsche Börse Group. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved.

Release TimeEmbargoed until 9:45 a.m. New Delhi timeMay 2, 2014

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MNI India Consumer Report - April 2014 3

MNI India Consumer Report - April 2014Contents

4 Editorial

6 Executive Summary

12 Economic Landscape

16 Indicators

17 MNI India Consumer Indicator

24 Personal Finances

26 Current Business Conditions

29 Durable Buying Conditions

30 Employment Outlook

31 Prices Sentiment

34 Interest Rate Expectations Indicator

35 Stock Investment Indicator

37 Real Estate Investment Indicator

40 Car Purchase Indicator

42 Special Question

43 Consumer Sentiment - Regions

47 Consumer Sentiment - Income Group

48 What the Panel Said

50 Data Tables

58 Methodology

Spitzzeile Titel4

Elections are usually periods of great uncertainty but the continued rise in the Sensex as national elections get underway in India belies this.

Election Fever


Elections are usually periods of great uncertainty but the continued rise in the Sensex as national elections get underway in India belies this.

The Sensex hit a fresh all-time high of 22,870 on April 23, buoyed by international investors who see a post-election India being able to dig itself out of the economic hole it’s in. Recent opinion polls have shown the business friendly opposition BJP, led by Narendra Modi, holding a strong lead. The party has promised to kick-start the economy, improve infrastructure, contain inflation and promote foreign investment.

The danger for equity markets is that they are strongly pricing in a Modi win. Elections are full of surprises and India’s opinion polls have been grossly inaccurate in each of the two previous national elections. In 2004, Congress won even after the polls suggested the BJP would retain power, leading the biggest single-day sell off of stocks in more than four years. In 2009, most opinion polls predicted a close fight, although Congress won with the largest tally in 20 years.

Even if business positive Modi wins, the rally in equity markets has been nothing but spectacular given the current economic malaise, leaving them very open to disappointment.

Our monthly Business and Consumer Sentiment surveys suggest that companies have turned the corner and appear optimistic that a new government will turn the economy around. Indian politicians are expected to spend around $5 billion on campaigning for elections – so at least this splurge would give India’s staggering economy a temporary boost!

The important question is what will happen next? India’s diverse political landscape makes election results hard to forecast and there are 11 days until the polls close. Whatever the outcome is, an unclear verdict or a weak government would worsen the situation. A stable government with clear reform objectives is a must for stronger economic growth in the coming years.

Philip UglowChief EconomistMNI Indicators

MNI China Consumer Report - July 20136

The MNI India Consumer Indicator remained broadly stable in April, with consumers very much in wait-and-see mode before the general election concludes on May 12.

Executive Summary



Following a small decline in March and a rise to a 14-month high in February, the Consumer Indicator stood at 125.2 in April compared with 125.8 in March.

The Current Indicator, which measures consumers assessment of current conditions, decreased by 1.2% to 114.1 in April from 115.5 in March and the Expectations Indicator remained broadly stable at 132.6 in April compared with 132.8 previously.

For the April survey we asked if consumers thought that economic growth in India would be boosted after the general election. Just 40.8% of respondents thought that the Indian economy will improve after the election. Many respondents were concerned about the stability of the government and the type of coalition. 21% thought that elections were not an answer to the issues the country faces and that economic growth will not receive a boost, with many pointing to widespread corruption among parties. A significant portion, 38.2% of the respondents, were uncertain about the impact of the election on the economy.

The Consumer Indicator rose in seven out of the ten major Indian cities in April apart from Delhi, Pune and Surat. A sharp improvement in consumer sentiment made Chennai the most optimistic city in April while respondents from Delhi were the least.

Consumers were more optimistic about their Current Personal Finances compared with the previous month but a growing number of respondents reported that they did not expect their future Personal Finances to improve.

Perceptions about the current state of business improved in April and both short and longer term

expectations about future business conditions also increased.

A smaller proportion of respondents reported that it was a good time or excellent time to purchase large household goods as compared with the previous month.

Consumers’ dissatisfaction with the current level of prices increased in April, while expectations for inflation in a year’s time eased slightly to the lowest since July 2013.

The Stock Investment Indicator, which gauges whether it is a good time to invest in the stock market, increased significantly to 110.9 in April from 89.7 in the previous month, as the continued rise in the stock market made many investors better off.

The Real Estate Investment Indicator declined for the second consecutive month in April having risen close to the series’ high in February.

The Car Purchase Indicator declined in April as consumers’ willingness to purchase a car deteriorated after rising for two consecutive months to the highest level in 10 months in March.

MNI India Consumer Indicator - Components

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All India - Overview

Feb-14 Mar-14 Apr-14Highest

Since Lowest

Since 3-Month Average

Monthly Change

Monthly % Change

MNI India Consumer Indicator 127.8 125.8 125.2 - Jan-14 126.3 -0.6 -0.5%

Current Indicator 118.4 115.5 114.1 - Jan-14 116.0 -1.4 -1.2%

Expectations Indicator 134.2 132.8 132.6 - Jan-14 133.2 -0.2 -0.1%

Personal Finance: Current 125.3 119.4 121.8 Feb-14 - 122.2 2.4 2.0%

Personal Finance: Expected 137.4 133.1 130.2 - Jan-14 133.6 -2.9 -2.1%

Business Condition: 1 Year 128.2 124.5 126.3 Feb-14 - 126.3 1.8 1.5%

Business Condition: 5 Years 136.9 140.8 141.3 series high - 139.7 0.5 0.4%

Durable Buying Conditions 111.4 111.6 106.4 - Jan-14 109.8 -5.2 -4.7%

Current Business Conditions Indicator 116.0 102.9 106.3 Feb-14 - 108.4 3.4 3.4%

Stock Investment Indicator 105.1 89.7 110.9 series high - 101.9 21.2 23.7%

Real Estate Investment Indicator 119.1 117.8 114.4 - Jan-14 117.1 -3.4 -2.9%

Car Purchase Indicator 73.0 75.3 71.7 - Jan-14 73.3 -3.6 -4.7%

Employment Outlook Indicator 121.8 115.7 115.7 - Jan-14 117.7 0.0 0.0%

Inflation Expectations Indicator 154.8 154.2 152.2 - Jul-13 153.7 -2.0 -1.3%

Current Prices Satisfaction Indicator 75.4 67.2 66.3 - series low 69.6 -0.9 -1.4%

Interest Rates Expectations Indicator 134.6 133.0 133.6 Feb-14 - 133.7 0.6 0.4%


All India - Summary2013 2014

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr

MNI India Consumer Indicator 123.9 124.5 122.9 119.5 118.7 115.9 120.2 122.5 123.9 121.2 127.8 125.8 125.2

Current Indicator 119.5 120.7 113.7 114.1 113.9 109.3 113.9 117.0 119.0 113.2 118.4 115.5 114.1

Expectations Indicator 126.8 127.0 129.0 123.0 122.0 120.3 124.3 126.2 127.2 126.6 134.2 132.8 132.6

Personal Finance: Current 121.1 122.2 115.8 114.2 116.3 118.0 117.1 123.3 122.5 120.5 125.3 119.4 121.8

Personal Finance: Expected 131.8 131.0 128.3 121.9 122.1 118.4 122.4 125.3 131.0 127.8 137.4 133.1 130.2

Business Condition: 1 Year 117.2 119.4 124.2 121.2 115.3 114.1 119.3 118.2 117.4 119.3 128.2 124.5 126.3

Business Condition: 5 Years 131.6 130.5 134.6 126.0 128.5 128.4 131.3 135.2 133.1 132.7 136.9 140.8 141.3

Durable Buying Conditions 117.9 119.2 111.6 114.0 111.5 100.7 110.7 110.7 115.5 106.0 111.4 111.6 106.4

Current Business Conditions Indicator 120.0 121.0 118.4 113.1 111.4 108.9 108.2 109.1 114.5 108.9 116.0 102.9 106.3

Stock Investment Indicator 102.3 101.4 110.1 105.1 104.5 106.4 96.8 96.8 102.3 102.3 105.1 89.7 110.9

Investment Return 105.1 104.0 102.7 112.7 110.9 125.2 94.0 93.5 100.5 103.0 104.5 82.7 114.6

Stock Price Sentiment 103.7 103.5 100.4 111.9 116.5 124.8 107.5 115.8 105.8 107.4 103.7 128.6 119.3

Stock Market Expec-tations 105.5 103.8 127.8 114.6 119.2 118.8 103.8 112.6 112.1 111.1 114.3 114.9 137.4

Real Estate Invest-ment Indicator 119.9 113.1 115.7 115.1 109.8 109.7 110.4 113.2 114.4 114.2 119.1 117.8 114.4

House Price Expec-tations 139.1 133.3 136.3 135.1 140.8 144.7 148.6 147.9 143.8 143.1 152.6 148.6 145.9

House Buying Sen-timent 121.5 115.5 119.7 114.7 100.6 98.1 95.0 92.8 104.8 94.9 107.7 102.8 102.1

House selling Senti-ment 101.1 109.4 109.0 104.4 111.9 113.6 112.5 101.2 105.4 95.5 102.9 98.2 104.9

Car Purchase Indi-cator 76.4 75.8 69.5 68.5 61.6 60.1 67.1 65.7 73.8 69.2 73.0 75.3 71.7

Car Purchase Expec-tations 109.2 106.0 98.5 105.7 94.3 90.3 98.4 97.7 103.0 99.0 103.2 108.9 102.3

Price of Gasoline Expectations 156.4 154.5 159.5 168.7 171.0 170.2 164.1 166.3 155.4 160.6 157.2 158.3 158.8

Employment Outlook Indicator 123.4 127.9 122.6 120.9 119.2 113.2 114.6 121.0 117.6 112.0 121.8 115.7 115.7

Inflation Expectations Indicator 134.0 136.5 143.9 144.4 152.9 156.1 152.4 159.2 152.6 153.6 154.8 154.2 152.2

Current Prices Satisfac-tion Indicator 96.5 99.7 96.4 93.9 92.6 83.2 90.2 70.2 86.2 75.7 75.4 67.2 66.3

Interest Rates Expecta-tions Indicator 123.0 125.6 120.4 129.6 133.8 136.1 137.5 138.8 140.4 136.3 134.6 133.0 133.6

All India - Records2012-Current

Minimum Maximum Mean Median

MNI India Consumer Indicator 115.9 133.7 123.6 123.4

Current Indicator 109.3 128.3 117.2 116.2

Expectations Indicator 120.3 137.3 127.9 127.1

Personal Finance: Current 114.2 135.4 122.0 121.4

Personal Finance: Expected 118.4 141.5 129.4 130.6

Business Condition: 1 Year 114.1 131.8 121.7 119.6

Business Condition: 5 Years 123.9 141.3 132.5 132.3

Durable Buying Conditions 100.7 121.1 112.4 111.6

Current Business Conditions Indicator 102.9 124.9 114.8 115.3

Stock Investment Indicator 89.7 110.9 102.7 102.9

Investment Return 82.7 136.5 108.2 105.8

Stock Price Sentiment 100.4 128.6 110.3 107.4

Stock Market Expectations 103.8 137.4 115.0 113.5

Real Estate Investment Indicator 109.7 119.9 114.9 114.4

House Price Expectations 133.3 152.6 142.7 143.1

House Buying Sentiment 92.8 121.5 107.0 106.1

House Selling Sentiment 95.5 113.6 106.2 105.2

Car Purchase Indicator 60.1 84.0 72.4 72.4

Car Purchase Expectations 90.3 114.8 103.5 104.5

Price of Gasoline Expectations 142.5 171.0 158.7 158.5

Employment Outlook Indicator 112.0 128.3 119.2 119.1

Inflation Expectations Indicator 126.8 159.2 147.6 152.3

Current Prices Satisfaction Indicator 66.3 115.9 86.6 88.2

Interest Rates Expectations Indicator 116.6 140.4 130.6 132.2


Many respondents thought that the Indian economy will improve after the election...

...but there were concerns about the stability of the government and the type of coalition.

Spitzzeile Titel12

Latest economic data from India have been disappointing and dashed hopes of a quick recovery.

Economic Landscape


Latest economic data from India have been disappointing and dashed hopes of a quick recovery. Industrial production fell in February following a small rise in January. Consumer price inflation ticked up again in March owing to higher food prices and the trade deficit widened to the highest level since October, due to higher gold imports in March.

The Reserve Bank of India kept the policy rate unchanged at 8% at its April meeting, allowing the rate increases undertaken between September 2013 and January 2014 to work their way through the economy. However, there are increased fears that the monsoon will be below normal and put pressure on food prices and restrain further the RBI’s ability to ease policy later this year.

Disappointing economic growth Economic growth in India slowed to 4.7% on the year in the three months to December, down from 4.8% in the previous quarter. It was, though, marginally above the 4.4% rate seen in the same period a year ago.

Data on an output basis showed that growth was boosted by services which grew 7% on the year, compared with 4.2% in the previous quarter. A bountiful harvest was expected to translate into strong agricultural growth but output here was disappointing as it slowed to 3.6% compared with 4.6% in the previous quarter. Manufacturing fell back into contraction, declining by 1.9% compared with 1% growth in the previous quarter.

The Finance Minister P Chidambaram expects the economy to grow by 4.9% this year and to accelerate to 6% in the next fiscal year. The economy must expand by 5.5% in the January-March quarter to achieve the forecast which on current evidence looks highly unlikely. The RBI has revised down its forecast for 2014 to 4.7% from 4.8% previously owing to weak

Economic Growth

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2010

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industrial production and investment. This would be the first time in 26 years that growth will be below 5% for two successive years.

Industrial output slumpsIndustrial production recorded the sharpest decline in nine months in February, falling by 1.9% on the year following a rise of 0.8% in January.

Much of the decline was led by weakness in manufacturing output which contracted by 3.7% on the year following a 0.7% decline in January. Thirteen out of the 22 industry groups within the manufacturing sector contracted in February, led by a 34.1% fall in ‘Radio, TV and communication equipment & apparatus’, followed by 24.6% drop in ‘Electrical machinery & apparatus’ and 21.3% in ‘Wearing apparel; dressing and dyeing of fur’.

After increasing 0.7% on the year in January, mining output grew by 1.4% in February. Output of consumer durables, a measure of consumer demand, posted the

GDP Y/Y % , fiscal year

Source: Central Statistical Organisation, India


Repo rate unchanged at 8%The RBI left the key policy rate unchanged at 8% at its first bi-monthly monetary policy of the financial year on April 1.

Governor Raghuram Rajan said that the Reserve Bank’s policy stance will be firmly focused on keeping the economy on a disinflationary glide path that is intended to hit 8% inflation by January 2015 and 6% by January 2016. A central bank panel recently proposed to revamp its policymaking structure by setting a long-term consumer price inflation target of 4%, plus or minus 2%. As inflation remains high, it recommended that the goal should be phased in gradually.

fifteenth consecutive decline, falling 9.3% in February compared with an 8.3% decline in the previous month. Capital goods output, a proxy for investment, fell sharply by 17.4% on the year, compared with a decline of 4.1% in January.

Inflation ticks upConsumer price inflation rose for the first time in four months to 8.3% compared with a revised 8% rate in February. The rise was driven by an increase in food prices. Food price inflation, which makes up almost half of the basket, increased to 9.1% from 8.6% in the previous month. Softer prices for clothing, footwear, public transport and communication helped to keep core CPI unchanged from the previous month at 7.9%.

Wholesale price inflation rose sharply to 5.7% in March from a nine month low of 4.7% in February, with both food and fuel inflation increasing but also a general rise in the price of manufactured goods.

In the coming months, there are additional risks of less-than-normal monsoon rains due to possible El Niño effects, which could have a negative impact on India’s agricultural output.

Rajan has said that if inflation falls as expected, further policy tightening in the near term is not anticipated.

Fiscal budget deficitThe government budget deficit stood at Rs. 5.99 trillion in the April-February period, or 114.3% of the target for the year ending March 2014, compared with 97.4% at the same point a year ago. Net tax receipts

Industrial Production

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Industrial Production

Source: Central Statistical Organisation, India

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Wholesale Price Inflation*

Consumer Price Inflation**

Source: *Office of the Economic Advisor, India, **MOSPI


totalled Rs. 6.27 trillion in the first eleven months to March, while total expenditure was about Rs. 14 trillion.

The government has proposed to bring down the fiscal deficit to 4.6% of GDP in 2013-14. It plans to defer some subsidy payments to next year, while focusing on speeding up the sale of stakes in state-run firms and minority stakes in some private companies. The government raised over Rs. 610 billion from selling licences for the mobile internet spectrum in February.

The fiscal deficit for 2014-15 is projected at 4.1% of GDP and 3% of GDP in 2016-17.

Foreign reserves decline Foreign exchange reserves fell slightly to $309.41 billion in the week ending April 18, from $309.44 billion a week earlier, after increasing for seven consecutive weeks. as overseas investors poured money into the stock market. According to the RBI’s weekly statistical supplement, foreign currency assets, the biggest component of the forex reserves, rose by $2.7 billion to $281.55 billion. These are expressed in dollar terms and include the effect of appreciation or depreciation of the non-US currencies such as the euro, pound and yen, held in its reserves.

Moves by the RBI over recent months have greatly strengthened India’s foreign exchange reserve position, leaving the country less vulnerable to another run on the currency. The value of India’s gold reserves remained unchanged at $21.56 billion.

Trade deficit widens in MarchIndia’s trade deficit widened to a five month high in March to $10.5 billion, up from $8.1 billion in February.

Exports declined for the second consecutive month on the year to $29.6, 3.2% below the level seen last year, although 15.1% above February’s $25.7 billion. Imports fell 2.1% on the year to $40.1 billion in

March and were 18.5% above the $33.8 billion recorded in February. Oil imports climbed from February’s $13.7 billion to $15.8 billion in March, the highest in 24 months. Gold imports rose to $2.7 billion from $1.6 billion in February, suggesting that underlying demand for gold is still firm and would increase if import curbs were lifted. For the fiscal year 2013-14, the trade deficit narrowed to $138.6 billion, down from $189.6 in the previous year aided by a rise in exports and fall in imports.

The current account deficit narrowed to $4.2 billion, or 0.9% of GDP in the October-December quarter, from $31.9 billion a year earlier, on the back of curbs on gold imports and a moderate pick-up in exports. The government expects to keep the current account deficit at $45 billion in the fiscal year that ends in March.

Car sales shrink in 2013Passenger car sales decelerated by 4.7% in the fiscal year that ended on March 31, the second consecutive year of decline. For the year as a whole, car sales totalled 17.9 billion, down from 18.7 billion in the previous year. In March, car sales increased by 6.7% over the previous month but were 5.1% below March 2013’s level. Many consumers in India have chosen to defer purchases of vehicles given the slowdown in the economy, higher loan rates and rising fuel prices.

The automobile industry is optimistic that sales will increase in 2014 as the economy rebounds and interest rates and inflation stabilise. Companies are looking forward to the new government’s budget to see if the excise tax cut from 12% to 8% that was announced in the interim budget in February will be continued.

Many car makers are launching compact cars to attract price sensitive customers and there have been reports that various new car models have generated a lot of interest and are expected to boost sales.


Following a small decline in March and a rise to a 14-month high in February, the Consumer Indicator remained broadly stable in March.

Indicators



Following a small decline in March and a rise to a 14-month high in February, the Consumer Indicator stood at 125.2 in April compared with 125.8 in March. Consumer confidence fell steadily throughout 2013 as the economy weakened, but gained momentum towards the end of the year. Consumer confidence hit a series low in September 2013, but is now just over 1% above the level seen in April a year ago.

The Current Indicator, which measures consumers’ assessment of current conditions, decreased by 1.2% to 114.1 in April from 115.5 in March and the Expectations Indicator remained broadly stable at 132.6 in April compared with 132.8 previously.

In April, two out of the five components which make up the MNI India Consumer Indicator declined. Current Personal Finances improved but consumers were less optimistic about future Personal Finances, which fell for the second month in a row. Consumers were more optimistic about Business Conditions in One Year, on the belief that the new government will be able to turn the economy around, while their longer term expectations remained broadly stable after rising for two consecutive months. Marred by inflation, consumers were less optimistic about purchasing a large household item in April.

125.2MNI India Consumer Indicator Remains Stable

MNI India Consumer Indicator

Apr-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14

MNI India Consumer Indicator 123.9 122.5 123.9 121.2 127.8 125.8 125.2

Current 119.5 117.0 119.0 113.2 118.4 115.5 114.1

Expectations 126.8 126.2 127.2 126.6 134.2 132.8 132.6

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MNI India Consumer Indicator

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Current and Expectations Indicators

Current

Expectations


125.2

114.1

132.6

Total Indicator Current Indicator Expectations Indicator

All India

129.5

123.7

133.4


South India

119.3

108.0

126.8


North India

128.6

117.5

136.1


East India

125.7

110.0

136.2


West India

122.7

117.4

126.2


Central India


The less timely quarterly consumer survey from the Reserve Bank of India showed that consumers’ expectations improved significantly in March compared with December, in line with our own survey. Respondents reported lower confidence on spending and a small proportion of respondents felt it was a good time for making outlays for big ticket purchases such as motor vehicles and houses, consistent with our monthly survey.

RegionsThe slight decline in the MNI India Consumer Indicator was led by North, West and Central India while consumers in the East and South regions were more optimistic compared with the previous month.

In South India, consumer sentiment increased to 129.5 in April from 123.4 in the previous month. In East India, the Consumer Indicator rose to 128.6 from 124.6 in the previous month, although was considerably lower from the level seen in April a year earlier.

Consumers remained more optimistic about future rather than current conditions. The Current Indicator declined in all regions apart from South and Central India.

AgeConsumer sentiment only improved in the youngest age range in April, rising by almost 3% on the month, close to the series high recorded in January 2013. In contrast, consumer sentiment declined in the two other age groups, though was still above the levels seen in the same period a year earlier.

The Consumer Indicator for the 18-34 age range rose to 128.1 in April, offsetting the decline to 124.5 in the previous month. All five components of the Consumer Indicator rose apart from Expected Personal

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Durable Buying Conditions

Consumer Indicator: Contribution to Monthly Change (% pt.)


Finances which remained broadly stable. The other two components of the Expectations Indicator, Business Conditions in One Year and Five Years rose by 5.8% and 3.2% respectively. Durable Buying Conditions increased for the first time in four months and Current Personal Finances rose to the highest level since January 2013. After a sharp rise in consumer sentiment among 35-54 year olds in February, confidence has fallen for two consecutive months. The decline in sentiment to 123.6 in April from 126.6 in March was led by Durable Buying Conditions and Expected Personal Finances. The rest of the three components that make up the Consumer Indicator remained broadly stable compared with the previous month.

For the oldest age range, 55-64 year olds, sentiment declined to 119.7 offsetting the previous month’s gain to 127.3. Apart from Current Personal Finances, all the other components fell. There were significant declines in consumers’ expectations about future Business Conditions and Durable Buying Conditions.

IncomeConsumer confidence improved in high income households and remained broadly stable among low income households.

The Consumer Indicator for households with an average annual income of over INR 432,000 increased almost 5% on the month to a series high of 133.4 in April from 127.1 in March. For households with an average annual income under INR 432,000, the indicator remained broadly stable at 124.3 after declining by 5% to 123.4 in March.

Compared with the previous year, confidence has increased 2% among lower income households, while

125.2

128.1

123.6

119.7

Total Indicator 18-34 35-54 55-64

Consumer Indicator: Age Groups

for higher income households it has risen by 5%. On average, though, the level of confidence remains greater for higher income households.


124.3

116.1

129.8


< INR 432,000 per annum

133.4

120.8

141.8


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MNI India Consumer IndicatorIncome Groups


MNI India Consumer IndicatorMain Cities

The Consumer Indicator rose in seven out of the ten major Indian cities in April apart from Delhi, Pune and Surat. A sharp improvement in consumer sentiment made Chennai the most optimistic city in April while respondents from Delhi were the least.

In the capital Delhi, consumer sentiment declined for the third time in a row to 116.3 from 121.1 in the previous month. All five components that make up the Consumer Indicator declined, apart from Business Conditions in One Year which rose to the highest level in 15 months. In contrast, Expectations for Longer term Business Conditions remained subdued. Perso-nal Finances, both current and expected, remained tight and led to lower optimism for purchase of large household items.

In Mumbai, India’s most populous city, consumer sentiment increased for the first time in three months to 129.6 in April from 124.5 in March. Consumers reported higher Personal Finances for the first time in three months and expected a sharp improvement in Business Conditions in One Year. However, expecta-tions for longer term business conditions were weak and fewer respondents were optimistic about buying large household items.

Consumer confidence in Bengaluru, the third largest city by population in India, rose sharply following a large decline in the previous month. The Consumer Indicator increased to 138.0 from 121.2 in March, led by significant improvements in both the Current and Expectations Indicators. Consumer sentiment in Bengaluru has been volatile over the past five months and in April, all five components rose apart from Du-rable Buying Conditions which fell slightly to the lowe-st since January.

Consumer sentiment rose the most in April in Chen-nai, driven by the festivities of the Tamil New Year.

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Consumer Indicator - Mumbai

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142.9

118.4

135.7

156.1

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ExpectationsIndicator

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PersonalFinances:Expected

BusinessConditions: 1

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Conditions

Consumer Indicator Components - Mumbai

The Consumer Indicator increased from 118.4 in Mar-ch to 139.6 in April and was 5.1% above the same period a year earlier.


100

105

110

115

120

125

130

Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14

Consumer Indicator - Delhi

80

90

100

110

120

130

140

150

160


Consumer Indicator - Bengaluru

103.9

124.6

107.0

125.4 128.9119.3

100.9

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components - Delhi

126.5

145.7 148.0

131.0138.0

168.0

105.0

CurrentIndicator





Year


Year

DurableBuying

Conditions

Consumer Indicator Components - Bengaluru


Consumers were more optimistic about their Current Personal Finances compared with the previous month but a growing number of respondents reported that they did not expect their future Personal Finances to improve. Current Personal Finances, which measures whether the financial situation of a household is better, the same or worse than a year ago, rose to 121.8 in April from 119.4 in March. Current Personal Finances hit a low in the summer of 2013, but have subsequently bounced back and currently stand at around the same level as in April 2013.

The percentage of respondents who reported that their current financial situation improved compared with a year ago remained broadly unchanged at 44% compared with 43.5% in March. Those reporting financial conditions were the same as last year increased to 48% from 45.4%, while those reporting a worsening fell to 8.1% from 11.2% previously.

Out of those who responded that their financial conditions improved, the majority cited better income as the reason for the improvement.

Expected Personal Finances, which measures whether households think their finances will be better in a year’s time, declined for the second month in a row to 130.2 from 133.1 in March. The percentage of respondents reporting that they expected their financial situation to improve in a year’s time fell from 60% to 55.2%.

121.8Personal Finances Expected Finances Fall

Personal Finances


Current 121.1 123.3 122.5 120.5 125.3 119.4 121.8

Expectations 131.8 125.3 131.0 127.8 137.4 133.1 130.2

100

110

120

130

140

150


Personal Finances

Current

Expectations

8.1%

35.8%

48.0%

7.9%

0.3%

Current Financial Situation Compared with 1 Year Ago (% of Households)

Much Better

A Little Better

Same

A Little Worse

Much Worse


0.4%

2.3%

22.3%

75.0%

Monthly Household Income Used for Daily Expenses (% of Households)

29.0%

47.9%

16.1%

6.7%

Monthly Household Income Used for Savings (% of Households)

84.5%

10.3%

4.7%

0.5%

Monthly Household Income Used for Large Loan Repayment (% of Households)

84.2%

15.1%

0.7%

Monthly Household Income Used for Investments(% of Households)

How Households Spend their Money

0% - 29% of Income

30% - 49% of Income

0% of Income

1% - 29% of Income

0% of Income

1% - 29% of Income

0% of Income

1% - 29% of Income

50% - 69% of Income

70% - 100% of Income

30% - 49% of Income


30% - 49% of Income


30% -49% of Income



Perceptions about the current state of business improved in April and both short and longer term expectations about future business conditions also increased.

The Current Business Conditions Indicator, which measures respondents’ views on the state of business compared with a year earlier, rose from a series low of 102.9 in March to 106.3 in April. Current business sentiment has declined considerably since the survey started in November 2012 and despite April’s rise, was still 11.4% below the same period a year ago.

The proportion of respondents who were positive about business conditions fell from 31.1% in March to 29.9%, while the proportion of those who found them “just fair” increased significantly to 48.6% from 39.7% previously. Respondents who said business conditions were “poor” or “very poor” decreased sharply to 16.8% from 24.4% previously.

Expectations for Business Conditions in a Year rose to 126.3 in April from 124.5 in March, as more than half of respondents reported that business conditions would be better in a year’s time.

The majority of those who expected business conditions to be better in a year cited economic development as the main reason, although fewer than in the previous month. Respondents who expected business conditions to worsen, cited income and employment as the main reasons. Many respondents

106.3Business ConditionsLonger Term Expectations Hit Record High

Business Conditions


Current 120.0 109.1 114.5 108.9 116.0 102.9 106.3

In 1 Year 117.2 118.2 117.4 119.3 128.2 124.5 126.3

In 5 Years 131.6 135.2 133.1 132.7 136.9 140.8 141.3

40

50

60

70

80

90

100

110

120

130

140


Current Business Conditions Indicator

90

100

110

120

130

140

150


Expected Business Conditions: 1 Year and 5 Years

1 Year

5 Years


Business ConditionsSelected Reasons

Government/Policy

Econ. Development

Income/Employment

Resource/Environment

Social Stability/ Security

Events

Government/Policy

Econ. Development

Income/Employment



Events

29.0%

46.2%

12.2%

7.3%4.7%

0.6%

All India, Reasons for Better

35.4%32.9%

11.1%

6.0%

13.9%

0.7%

All India, Reasons for Worse

69.7% 68.8%

30.3% 31.2%

Mar-14 Apr-14

All Indiaexpected business conditions to improve after the national elections in the hope that a new government will push forward with business friendly policies.

Longer term, Expectations for Business Conditions in Five Years have been on an upward trend since July last year and rose to a series high in April. The indicator increased very slightly to 141.3 from 140.8 previously. Among the major cities surveyed, Chennai was the most optimistic and Bengaluru witnessed the largest jump in expectations from the previous month.

Better

Worse


Business Conditions in 1 YearRegions

126.3

121.8 121.5

129.7

134.2

112.5

All India North India

SouthIndia

EastIndia

WestIndia

Central India

Business Expectations

North India South India East India West India Central India

Reasons for Better (% of Respondents)

62.3% 67.4%80.5%

71.1%60.0%

37.7% 32.6%19.5%

28.9%40.0%


Business Expectations: Better or Worse?(% of Respondents)


Reasons for Worse (% of Respondents)

Better

Worse

Government/Policy

Econ. Development

Income/Employment



Events

Government/Policy

Econ. Development

Income/Employment



Events


The Durable Buying Conditions Indicator declined to 106.4 in April from 111.6 in March, as a smaller proportion of respondents reported that it was a good time or excellent time to purchase large household goods.

Sentiment on buying conditions fell throughout most of last year, highlighting pressure on consumers’ disposable income, owing to the weakening of the economy and high inflation. The ground lost in 2013 has still not been regained, with the result in April down 9.7% from the same period a year earlier.

Out of the ten largest cities surveyed, respondents from Kolkata were the most optimistic about buying a large household item in April. Compared with the previous month, more consumers from Kolkata, Ahmadabad and Chennai thought it was a better time to buy a large household item.

The Durable Buying Conditions Indicator decreased in all regions apart from East and Central India. Respondents from East India were the most optimistic about buying durable goods with the indicator rising to 120.2, the highest level in four months.

For all India, the proportion of respondents who said it was an “excellent time” or “good time” to buy large household goods declined to 37.6% from 42.5% in the previous month, while the proportion of those saying it was a “bad time” or “very bad time” increased to 20.5% from 18.6%.

Durable Buying Conditions Deteriorate in April



Durable Buying Conditions 117.9 110.7 115.5 106.0 111.4 111.6 106.4

106.4

95

100

105

110

115

120

125



0.1%

37.5%

40.0%

16.0%

4.5%

1.9%

Is It a Good or Bad Time to Buy Large Household Goods? (% of Households)

Excellent Time

Good Time

Neutral

Bad Time

Very Bad Time

Don‘t Know/No Answer


The Employment Outlook Indicator remained flat at 115.7 in April after declining significantly in the previous month.

The indicator measures opinion on the outlook for the employment market over the next 12 months and the April reading was below the average of the series of 119.2 and 6.3% below the same period a year ago.

Respondents from Central and South India expected an improvement in the employment situation in the next 12 months while those from East and West India were less optimistic about the employment outlook.

The proportion of respondents who expected an improvement in the Employment Outlook declined to 41.6% in April from 43.8% in March, while those forecasting a worsening also fell to 12% from 14.4%. Those suggesting there would be no change increased from 41.7% to 46.4%.

Employment Outlook IndicatorRemains Stable

Employment Outlook


Employment Outlook 123.4 121.0 117.6 112.0 121.8 115.7 115.7

100

105

110

115

120

125

130


Employment Outlook Indicator

2.4%

39.2%

46.4%

11.4%

0.6%

Employment Outlook for the Next 12 Months (% of Households)

115.7

Much Better

A Little Better

Same

A Little Worse

Much Worse



Consumers’ dissatisfaction with the current level of prices increased in April, while expectations for inflation in a year’s time eased slightly to the lowest since July 2013.

The Current Prices Satisfaction Indicator declined to a series low of 66.3 in April compared with 67.2 in the previous month. A figure below 100 indicates wider dissatisfaction with the current level of prices. The further below 100, the greater the dissatisfaction. The indicator has trended down since the start of the survey in November 2012 and was above 100 in only the first two months of the survey.

India’s consumer price inflation rose again in March to 8.3% from 8% in February. Food price inflation, which makes up almost half of the basket, increased to 9.1% from 8.6% in the previous month. Wholesale price inflation also rose sharply to 5.7% in March from a nine month low of 4.7% in February

The Inflation Expectations Indicator, which measures whether respondents think prices will be higher or lower in 12 months’ time, declined to 152.2 from 154.2 in March. Consumers’ expectations for inflation have remained elevated since November 2012 when the series started. Some respondents expected the new government to help bring down price pressures.

The percentage of respondents who believed prices would be higher in a year’s time fell from 83.9% to 82.5%, while those saying prices would be about the

Prices SentimentDiscontent Hits a New Low

Prices Sentiment


Satisfaction with Current Prices 96.5 70.2 86.2 75.7 75.4 67.2 66.3

Inflation Expec-tations 134.0 159.2 152.6 153.6 154.8 154.2 152.2

60

70

80

90

100

110

120


Current Prices Satisfaction Indicator

110

120

130

140

150

160

170


Inflation Expectations Indicator

66.3


1.1%

16.8%

16.9%

44.1%

21.2%

Satisfaction with Current Prices (% of Households)

Very Satisfied

Quite Satisfied

So So

Not Very Satisfied

Not Satisfied At All


27.2%

55.3%

12.4%5.0%

0.1%

Inflation Expectations in 12 Months (% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower


same level increased to 12.4% from 9.9% in the previous month. A small proportion of respondents believed prices would be lower in a year’s time.

Of those who thought prices would go up, a growing proportion of respondents thought that prices would rise by less than 5%, which was down from expectations of a price rise of 5% in March and between 6% and 9% in February and over 25% in January.

Regions Satisfaction with Current Prices worsened significantly in North and Central India, both hitting a series low. In North India, the proportion of respondents who were satisfied with the current level of prices fell from 17.8% to 14.1%, while in Central India, the proportion of satisfied consumers more than halved compared with the previous month.

Apart from South and East India, more respondents from the other three regions expected prices to fall in a year’s time as compared with the previous month. Consumers from the West region had the highest inflation expectations on the month, well above the same period a year ago.

Prices SentimentRegions


66.3

54.9

67.5

80.7

70.9

50.9


SouthIndia

EastIndia

WestIndia

Central India

Current Prices Satisfaction Indicator

152.2

148.9147.7

152.4

157.7

152.7


SouthIndia

EastIndia

WestIndia

Central India

Inflation Expectations Indicator


SouthIndia

EastIndia

WestIndia

Central India

Satisfaction with Current Prices(% of Households)

Very Satisfied

Quite Satisfied

Neutral

Not Very Satisfied

Not Satisfied At All


North India

SouthIndia

EastIndia

WestIndia

Central India

Inflation Expectations in 12 Months(% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower



The Interest Rate Expectations Indicator remained broadly stable in April after declining for three consecutive months.

The indicator stood at 133.6 in April compared with 133.0 in the previous month, although was well above the outturn of 123.0 recorded in the same period a year ago. Since September 2013, when Raghuram Rajan took over as the Governor of the RBI, interest rates have been hiked three times in order to stabilise the sharp fall of the rupee and control inflation.

The RBI left the key policy rate unchanged at 8% at its first bi-monthly monetary policy of the financial year on April 1. Raghuram Rajan said that the Reserve Bank’s policy stance will be firmly focused on keeping the economy on a disinflationary glide path that is intended to hit 8% inflation by January 2015 and 6% by January 2016. If inflation falls as expected, further policy tightening in the near term is not anticipated.

Interest Rate ExpectationsBroadly Stable

Interest Rate Expectations


Interest Rate Expectations 123.0 138.8 140.4 136.3 134.6 133.0 133.6

133.6

100

110

120

130

140

150


Interest Rate Expectations Indicator

15.2%

43.7%

17.5%

4.7%1.2%

17.7%

Expected Change in Interest Rate in 1 Year (% of Households)

Much Higher

A Little Higher

Same

A Little Lower

Much Lower


The Stock Investment Indicator, which gauges whether it is a good time to invest in the stock market, increased significantly to 110.9 in April from 89.7 in the previous month, as the continued rise in the stock market made many investors better off.

Indian equities have rallied in recent weeks helped by a growing expectation that the ongoing general election will help to improve economic growth. Some improvement in recent macroeconomic data including a narrower current account deficit has also helped, with the rally in the markets led by strong foreign investment inflows. The benchmark Sensex hit another all-time high of 22,869.85 on April 23. Analysts expect to see increased volatility in the benchmark index during the elections which are set to conclude by May 12.

The Indicator is made up of three components. Stock Price Sentiment component, which measures whether respondents view equity prices as high or low and has a negative impact on the overall indicator, declined to 119.3 after a sharp rise to a record high in March to 128.6.

The Stock Investment Return component increased significantly to 114.6 in April from 82.7 in March. The proportion of respondents who made a loss in the last year almost halved to 25.7% from 50.1% in the previous month while those who made a profit increased from 28.2% to 53.7%.

Expectations for the stock market in three months’ time jumped to 137.4 from 114.9 in March.

Stock Investment IndicatorAbove 100

Investment Sentiment


Investment Sentiment Indicator 102.3 96.8 102.3 102.3 105.1 89.7 110.9

Investment Return 105.1 93.5 100.5 103.0 104.5 82.7 114.6

Stock Price Sentiment 103.7 115.8 105.8 107.4 103.7 128.6 119.3

Stock Market Expectation 105.5 112.6 112.1 111.1 114.3 114.9 137.4

70

80

90

100

110

120

Feb-13 May-13 Aug-13 Nov-13 Feb-14

Stock Investment Indicator

11.86

3.47

8.38

Investment Return

Stock Price Sentiment

Stock MarketExpectations

Stock Investment Indicator: Contribution to Monthly Change (% pt.)

110.9


110.9 114.6 119.3

137.4

Stock InvestmentIndicator

Investment Return

Stock PriceSentiment

Stock MarketExpectations

Stock Investment Indicator - Components

80

90

100

110

120

130

140


Stock Price Sentiment

70

80

90

100

110

120

130

140


Investment Return

90

95

100

105

110

115

120

125

130

135

140


Stock Market Expectations

Stock Investment IndicatorRegions and Components


The Real Estate Investment Indicator, which gauges whether it is a good time to invest in the housing market, declined for the second consecutive month in April having risen close to the series’ high in February.

The indicator fell to 114.4 in April from 117.8 in March, although the three month trend edged up slightly and has now risen for six consecutive months. Sentiment on real estate dipped in the second half of last year before picking up in 2014.

Indian developers and contractors are reliant on ties with the government to acquire land or win contracts and many projects are stalled, at least temporarily, until the conclusion of the elections.

The Real Estate Investment Indicator is composed of three sub-indicators; House Price Expectations, House Buying Sentiment and House Selling Sentiment.

House Buying Sentiment remained relatively stable in April at 102.1 compared with 102.8 in the previous month. There was a decline in the proportion of respondents who said it was an excellent or a good time to buy a house from 38.1% to 35.4%. There was a significant rise in the number of responses from consumers who said it was an okay time for a house purchase.

Since May 2013, increasingly more consumers have expected that prices would rise in the next six months. After rising to a series high in February, the House Price Expectations component eased to 145.9 in April, down from 148.6 in March. The proportion of

Real Estate Investment Indicator Second Decline in a Row

Real Estate Investment Sentiment


Real Estate Invest-ment Sentiment 119.9 113.2 114.4 114.2 119.1 117.8 114.4

Price Expectations 139.1 147.9 143.8 143.1 152.6 148.6 145.9

House Buying 121.5 92.8 104.8 94.9 107.7 102.8 102.1

House Selling 101.1 101.2 105.4 95.5 102.9 98.2 104.9

114.4

100

105

110

115

120

125


Real Estate Investment Indicator

-0.77

-0.21

-1.89

Price Expectations

House Buying Sentiment

House Selling Sentiment

Real Estate Investment Indicator: Contribution to Monthly Change (% pt.)


110

120

130

140

150

160


Real Estate Prices: Expected Changes in Next 6 Months

117.8102.8 98.2

148.6

114.4102.1 104.9

145.9

Real EstateInvestmentIndicator

House BuyingSentiment


House Price Expectations

Real Estate Investment Indicator - Components


SouthIndia

EastIndia

WestIndia

Central India

Expected Changes in Real Estate Prices in the Next 6 months (% of Households)

Real Estate Investment IndicatorComponents and Balances

respondents who thought house prices would rise in the next six months declined from 73.5% to 71.4% in April.

The House Selling Sentiment component, which has a negative impact on the Real Estate Investment Indicator, increased significantly above the 100 mark in April to 104.9 from 98.2 in March.

RegionsThe Real Estate Investment Indicator fell in all regions apart from East India where a gain in House Price Expectations led the rise. Respondents in the other regions (North, South, West and Central India) were less optimistic about real estate investment.

March 2014

April 2014

Go Up Dramatically

Go Up Slightly

Stay the Same

Gow Down Slightly

Go Down Sharply



80

90

100

110

120

130


House Buying Sentiment

90

95

100

105

110

115

120



37.1%

38.5%

12.4%

5.9%2.7%

3.4%

Reasons for Buying Houses (% of Households)

1.4%

31.6%

34.1%

19.3%

2.6%10.9%

Timing for Selling Houses (% of Households)

Excellent Time

Good Time

Neutral

Bad Time

Very Bad Time


Prices

Income/Purchasing Power

Investment Value

Policy/Interest Rate

Supply and Quality

Others


The Car Purchase Indicator declined in April as consumers’ willingness to purchase a car deteriorated after rising for two consecutive months to the highest level in 10 months in March.

The indicator fell to 71.7 in April from 75.3 in March. The month’s decline put the indicator below the series average of 72.4 and 6.1% below the same period a year ago.

According to the Society of Indian Automobile Manufacturers, passenger car sales decelerated by 4.7% in the fiscal year that ended on March 31, the second consecutive year of decline.

The automobile industry is optimistic that sales will increase in 2014 as the economy rebounds and interest rates and inflation stabilise. Companies are looking forward to the new government‘s budget to see if the excise tax cut from 12% to 8%, announced in the interim budget in February, will continue.

The Car Purchase Expectations component, which gauges whether consumers believe it is a good or bad time to purchase a car over the next 12 months, declined the most in eight months to 102.3 from 108.9 in March. Of those who thought it would be a good time to buy a car, the majority believed they had better purchasing power.

The Indicator on Gasoline Prices, which measures expectations for the price of gasoline in a year, remained broadly stable at 158.8 in April compared with 158.3 in March.

Car Purchase Indicator Lowest Since January

50

60

70

80

90


Car Purchase Indicator

80

90

100

110

120

130

140

150

160

170

180


Car Purchase Indicator - Components

Car Purchase Expectations

Price of Gasoline

Car Purchase Sentiment


Car Purchase Sentiment 76.4 65.7 73.8 69.2 73.0 75.3 71.7

Car PurchaseExpectations 109.2 97.7 103.0 99.0 103.2 108.9 102.3

Price of Gasoline 156.4 166.3 155.4 160.6 157.2 158.3 158.8

71.7


Car Purchase IndicatorRegions

102.3 106.496.8

116.3

96.6108.0


SouthIndia

EastIndia

WestIndia

Central India

Car Purchase Expectations - Regions


SouthIndia

EastIndia

WestIndia

Central India

Reasons for a Bad Time to Buy a Car(% of Households)

Prices



Supply and Quality

Cost of Use/Upkeep

Others

Reasons for a Good Time to Buy a Car(% of Households)


SouthIndia

EastIndia

WestIndia

Central India

Prices



Supply and Quality

Cost of Use/Upkeep

Others

0.9%

29.1%

34.5%

18.9%

3.7%

12.9%

Is it a Good Time to Buy a Car?(% of Households)

Excellent

Good Time

Neutral

Bad Time

Very Bad Time



For the April survey, which was taken at the start of the month, we asked if consumers thought that economic growth in India will be boosted after the general election. Indian elections started on April 7 and will take place in a series of stages until May 12.

Just 40.8% of the respondents thought that the Indian economy will improve after the election. Many respondents said that there were concerns about the stability of the government and the type of coalition. 21% thought that elections were not an answer to the issues the country faces and that economic growth will not receive a boost, with many pointing to widespread corruption among parties. A significant portion, 38.2% of the respondents were uncertain about the impact of the election on the economy.

The BJP party is widely seen as benefiting from the rising popularity of its pro-business prime ministerial candidate, Narendra Modi who has promised to kick start the economy. The latest opinion polls suggest that the BJP and its allies could win the majority of legislative seats in national elections.

Special QuestionWill economic growth in India rise after the general election?

40.8%

21.0%

38.2%

Do you think economic growth in India will be boosted after the general election?

NoYes Don‘t Know/No Answer


MNI India Consumer Indicator Regions

108.0

126.8114.8

130.3121.8

128.4

101.2

CurrentIndicator





Year


Years

DurableBuying

Conditions

Consumer Indicator Components: North India

90

100

110

120

130

140


Consumer Indicator: North India

123.7133.4 131.8

121.9 121.5

156.7

115.5

CurrentIndicator





Year


Years

DurableBuying

Conditions

Consumer Indicator Components: South India

110

115

120

125

130

135

140


Consumer Indicator: South India


117.5

136.1

114.8

130.1 129.7

148.4

120.2

CurrentIndicator





Year


Years

DurableBuying

Conditions

Consumer Indicator Components: East India

100

110

120

130

140


Consumer Indicator: East India

110.0

136.2122.6

136.1 134.2 138.2

97.3

CurrentIndicator





Year


Years

DurableBuying

Conditions

Consumer Indicator Components: West India

90

100

110

120

130

140

150


Consumer Indicator: West India



Employment Outlook for the Next 12 Months (% of Households)

North India

South India

East India

West India

Central India

Expected Interest Rate on House and Car Loans Indicator

Much Better

A Little Better

About the Same

A Little Worse

Much Worse


117.4126.2 122.3

130.4

112.5

135.7

112.5

CurrentIndicator





Year


Years

DurableBuying

Conditions

Consumer Indicator Components: Central India

110

115

120

125

130

135

Jun-13 Sep-13 Dec-13 Mar-14

Consumer Indicator: Central India


All India North India South India East India West India Central India

Is it a Good/Bad Time to Buy Large Household Goods? (% of Households)

133.6

130.8132.1

126.3

138.8 137.5

All India NorthIndia

South India

East India

West India

CentralIndia

Interest Rates Expectations (% of Households)

71.7 71.8

75.3

78.0

66.2

75.0


SouthIndia

EastIndia

WestIndia

Central India

Car Purchase Indicator - Regions

Much Higher

A Little HIgher

About the Same

A Little Lower

Much Lower


Excellent Time

Good Time

Neutral

Bad Time

Very Bad Time



MNI India Consumer Indicator Income Groups

124.0 125.2 119.0

145.2

108.3




Year


Years

DurableBuying

Conditions

< INR 432,000 - Components

123.4

114.8

129.2

124.3

116.1

129.8



133.5 137.2 137.6150.6

108.1




Year


Years

DurableBuying

Conditions

> INR 432,000 - Components

127.1

120.0

131.9133.4

120.8

141.8



March 2014

April 2014

March 2014

April 2014

Spitzzeile Titel48

A selection of comments from the panel of consumers surveyed over the past month.

What the Panel Said

“The price of electronic gadgets is decreasing now, so it is a good time to buy such things.”

“After the election, business conditions on a whole will improve.”

“Lot of IT people in Chennai buy car as a status symbol.”

“Excise duty is reduced on consumer durables, cars and electronic products.”

“In Mysore, steel and cement prices have come down so house prices are lower.”

“Life is hard for the middle class people because of inflation.”

“As summer approaches, many are buying air conditioners, coolers and refrigerators.”

“If Modi government comes to power, then business conditions will be better.”

“Because of corruption, India is not developing in the right manner.”

“In the next one year, inflation would decrease.”

“Good education and excellent government policies can boost economic growth.”

“Property rates are 40% down. If Modi forms the government, then the economic condition will improve.”

“Taxes on consumer durable products has been reduced by the government.”

“As more and more IT companies are coming in Chennai, the demand for commercial real estate property is giving tough competition to other metropolitan cities.”

“Only double income couples can buy a house.”

“If AAP comes to power, it will be good for our country.”

“If leadership is strong, India will rise and if Manmohan Singh government comes to power again then it will go down.”

“Inflation is very high right now. After election, whichever party gets elected, we would like to see how they overcome this problem.”



A closer look at the data from the April consumer survey.

Data Tables


North India Overview


Since Lowest


Monthly Change

Monthly % Change

NorthI India Consumer Indicator 122.9 125.1 119.3 - Jan-14 122.4 -5.8 -4.6%



Personal Finance: Current 121.2 115.3 114.8 - Jan-14 117.1 -0.5 -0.4%


Business Condition: 1 Year 125.9 127.4 121.8 - Jan-14 125.0 -5.6 -4.4%

Business Condition: 5 Years 127.2 130.0 128.4 - Feb-14 128.5 -1.6 -1.2%



Stock Investment Indicator 101.6 77.1 106.4 Dec-13 - 95.0 29.3 38.1%


Car Purchase Indicator 74.7 69.8 71.8 Feb-14 - 72.1 2.0 2.9%

Employment Outlook Indicator 115.3 103.9 103.9 - series low 107.7 0.0 0.0%

Inflation Expectations Indicator 156.4 158.3 148.9 - Aug-13 154.5 -9.4 -6.0%


Interest Rates Expectations Indicator 130.7 133.3 130.8 - Feb-14 131.6 -2.5 -1.9%


South India Overview


Since Lowest


Monthly Change

Monthly % Change

South India Consumer Indicator 135.1 123.4 129.5 Feb-14 - 129.3 6.1 4.9%

Current Indicator 132.2 120.0 123.7 Feb-14 - 125.3 3.7 3.1%

Expectations Indicator 137.0 125.7 133.4 Feb-14 - 132.0 7.7 6.1%


Personal Finance: Expected 142.0 114.6 121.9 Feb-14 - 126.2 7.3 6.3%



Durable Buying Conditions 125.3 115.5 115.5 Feb-14 - 118.8 0.0 0.0%

Current Business Conditions Indicator 138.6 110.7 107.4 - series low 118.9 -3.3 -3.0%

Stock Investment Indicator 104.6 98.2 108.8 Jun-13 - 103.9 10.6 10.8%


Car Purchase Indicator 82.7 84.7 75.3 - Nov-13 80.9 -9.4 -11.2%

Employment Outlook Indicator 134.9 125.5 126.8 Feb-14 - 129.1 1.3 1.0%

Inflation Expectations Indicator 156.7 143.6 147.7 Feb-14 - 149.3 4.1 2.9%

Current Prices Satisfaction Indicator 96.2 64.0 67.5 Feb-14 - 75.9 3.5 5.3%

Interest Rates Expectations Indicator 146.8 127.3 132.1 Feb-14 - 135.4 4.8 3.8%


East India Overview


Since Lowest


Monthly Change

Monthly % Change

East India Consumer Indicator 129.4 124.6 128.6 Feb-14 - 127.5 4.0 3.3%

Current Indicator 116.0 112.7 117.5 Jan-14 - 115.4 4.8 4.3%




Business Condition: 1 Year 129.0 130.5 129.7 - Feb-14 129.7 -0.8 -0.7%


Durable Buying Conditions 109.7 116.4 120.2 Dec-13 - 115.4 3.8 3.3%

Current Business Conditions Indicator 113.5 109.3 120.7 Jun-13 - 114.5 11.4 10.4%

Stock Investment Indicator - - - - - - - -

Real Estate Investment Indicator 132.4 124.2 126.1 Feb-14 - 127.6 1.9 1.6%

Car Purchase Indicator 79.4 79.9 78.0 - Jan-14 79.1 -1.9 -2.4%

Employment Outlook Indicator 115.7 111.0 106.6 - Jan-14 111.1 -4.4 -3.9%

Inflation Expectations Indicator 149.8 145.1 152.4 Dec-13 - 149.1 7.3 5.0%

Current Prices Satisfaction Indicator 65.0 72.3 80.7 Oct-13 - 72.7 8.4 11.7%

Interest Rates Expectations Indicator 120.4 115.3 126.3 Jan-14 - 120.7 11.0 9.5%


West India Overview


Since Lowest


Monthly Change

Monthly % Change

West India Consumer Indicator 126.1 127.6 125.7 - Dec-13 126.5 -1.9 -1.5%

Current Indicator 113.9 115.2 110.0 - Sep-13 113.0 -5.2 -4.6%

Expectations Indicator 134.3 135.9 136.2 Nov-12 - 135.5 0.3 0.2%

Personal Finance: Current 121.6 121.7 122.6 Jan-14 - 122.0 0.9 0.7%


Business Condition: 1 Year 131.1 128.7 134.2 Nov-12 - 131.3 5.5 4.2%


Durable Buying Conditions 106.1 108.7 97.3 - series low 104.0 -11.4 -10.5%


Stock Investment Indicator 106.6 83.3 113.0 Jun-13 - 101.0 29.7 35.7%

Real Estate Investment Indicator 114.9 116.8 114.1 - Dec-13 115.3 -2.7 -2.3%

Car Purchase Indicator 62.9 71.2 66.2 - Feb-14 66.8 -5.0 -7.0%

Employment Outlook Indicator 119.7 120.2 119.2 - Sep-13 119.7 -1.0 -0.8%

Inflation Expectations Indicator 153.5 160.6 157.7 - Feb-14 157.3 -2.9 -1.8%

Current Prices Satisfaction Indicator 69.7 70.6 70.9 Jan-14 - 70.4 0.3 0.4%



Central India Overview


Since Lowest


Monthly Change

Monthly % Change

Central India Consumer Indicator 125.9 131.9 122.7 - Jan-14 126.8 -9.2 -7.0%

Current Indicator 113.1 116.5 117.4 Dec-13 - 115.7 0.9 0.8%


Personal Finance: Current 113.9 126.3 122.3 - Feb-14 120.8 -4.0 -3.1%


Business Condition: 1 Year 129.5 128.0 112.5 - Jan-14 123.3 -15.5 -12.1%

Business Condition: 5 Years 140.2 149.2 135.7 - Jan-14 141.7 -13.5 -9.0%

Durable Buying Conditions 112.3 106.8 112.5 Dec-13 - 110.5 5.7 5.4%


Stock Investment Indicator 116.7 - 133.3 series high - 83.3 133.3 0.0%

Real Estate Investment Indicator 118.3 125.7 121.1 - Feb-14 121.7 -4.6 -3.6%

Car Purchase Indicator 70.1 73.7 75.0 Dec-13 - 72.9 1.3 1.7%

Employment Outlook Indicator 123.8 111.9 121.4 Feb-14 - 119.0 9.5 8.5%

Inflation Expectations Indicator 158.2 163.6 152.7 - Jan-14 158.2 -10.9 -6.7%




All India Overview by Age


Since Lowest


Monthly Change

Monthly % Change

Age 18-34

MNI India Consumer Indicator 127.5 124.5 128.1 Jan-13 - 126.7 3.6 2.9%

Current Indicator 117.1 114.5 118.1 Dec-13 - 116.6 3.6 3.1%

Expectations Indicator 134.3 131.2 134.8 series high - 133.4 3.6 2.8%

Personal Finance: Current 124.6 121.1 126.5 Jan-13 - 124.1 5.4 4.5%


Business Condition: 1 Year 126.0 121.6 128.6 Jan-13 - 125.4 7.0 5.8%


Durable Buying Conditions 109.7 108.0 109.6 Feb-14 - 109.1 1.6 1.5%

Age 35-54


Current Indicator 121.7 117.1 111.4 - Sep-13 116.7 -5.7 -4.8%


Personal Finance: Current 127.9 119.4 118.4 - Aug-13 121.9 -1.0 -0.8%



Business Condition: 5 Years 140.2 140.1 140.1 Feb-14 - 140.1 0.0 0.0%


Age 55-64






Business Condition: 1 Year 126.1 133.1 122.1 - Dec-13 127.1 -11.0 -8.3%


Durable Buying Conditions 101.9 114.6 98.1 - Dec-12 104.9 -16.5 -14.4%


All India - Overview by Income


Since Lowest


Monthly Change

Monthly % Change


MNI India Consumer Indicator 129.8 123.4 124.3 Feb-14 - 125.8 0.9 0.7%









MNI India Consumer Indicator 132.6 127.1 133.4 series high - 131.0 6.3 4.9%


Expectations Indicator 138.9 131.9 141.8 series high - 137.5 9.9 7.5%



Business Condition: 1 Year 128.0 121.0 137.6 series high - 128.9 16.6 13.7%


Durable Buying Conditions 112.2 111.3 108.1 - Sep-13 110.5 -3.2 -3.0%


Methodology

The MNI India Consumer Sentiment Survey is a wide ranging monthly survey of consumer confidence across India.

Data is collected via telephone interviews. At least 1,000 interviews are conducted each month across the country.

The survey adopts a similar methodology to the University of Michigan survey of U.S. consumer sentiment.

The main MNI India Consumer Indicator is derived from five questions, two on current conditions and three on future expectations:

1) Current personal financial situation compared to a year ago2) Current willingness to buy major household items3) Personal financial situation one year from now4) Overall business conditions one year from now5) Overall business conditions for the next 5 years

Indicators relating to specific questions in the report are diffusion indices with 100 representing a neutral level, meaning positive and negative answers are equal. Values above 100 indicate increasing positivity while values below show increasing negativity.


Insight and data for better decisions

Discovering trends in Emerging MarketsMNI’s new indicators explore attitudes, perspectives and confidence in Russia, India and China. Our data and monthly reports present an advance picture of the economic landscape as perceived by businesses and consumers.

Our indicators allow investors, economists, analysts, and companies to identify economic trends and make informed investment and business decisions. Our data moves markets.

www.mni-indicators.com

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Date post:	06-May-2015
Category:	Economy & Finance
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MNI India Consumer Report 2014-04

Economy & Finance