Alongside this positive trend, capacity pressures continued to build, with unfinished work rising solidly. On the pricing front, average charges increased at a quicker pace, despite cost pressures retreating to a six-month low.

The seasonally adjusted HSBC India Services PMI Business Activity Index reached 58.7 in April, up from 58.5 in March, indicating a sharp and stronger expansion in service sector output. The headline figure was above its long-run average of 54.2.

The overall expansion in output was fueled by a significant rise in new business intakes, the joint-best in eight months, with many firms noting favorable demand conditions and successful marketing efforts.

Indian companies continued to benefit from improved international demand for their services, with Asia, Europe, the Middle East and the US particularly cited as sources of strength.

Indian services companies increased their workforce numbers for the thirty-fifth consecutive month in April.

Input prices rose moderately and at the slowest pace for six months at the start of the 2025/26 fiscal year. Indian services firms increased their average selling prices during April, as they sought to transfer higher cost burdens to clients.

The overall level of business confidence was at its lowest in close to two years.

The latest data showed a modest acceleration in growth of aggregate output, as signaled by the HSBC India Composite PMI Output Index rising from 59.5 in March to 59.7. The latest reading was consistent with a sharp rate of expansion that was the strongest since August 2024.

There were quicker increases at both goods producers and service providers. New business volumes across the private sector rose at the fastest pace in eight months, helped by a pick-up in growth across the service economy. The upturn at goods producers was broadly similar to March.

Both manufacturing firms and their services counterparts registered faster expansions in new export orders. At the composite level, the rate of growth was at a nine-month high.