India's core sector growth hits five-month high of 5% in June

“The pick-up in June was not broad-based and was led by an improvement in the performance of just four of the nine sectors,” the rating agency said.

For the first quarter of the fiscal year, the core sectors expanded 3.6% against 1% in the same period of 2025-26. The base effect from the new series partly explains the acceleration, though the underlying pattern remains uneven.

Cement and electricity growth point to sustained construction activity and peak summer power demand. Coal output, though modest, helps thermal power plants maintain stockpiles before the monsoon. The weak spots–crude oil, natural gas, refinery products and fertiliser–reflect separate pressures. ICRA said fertiliser supply chains have been disrupted by the West Asia situation, while the energy complex faces softer global refining margins and lower domestic gas output.

ICRA expects core sector growth to stay in the 3-5% range in the near term, constrained by the narrow breadth evident in the June print.