This report highlights a significant moderation in year-on-year (YoY) economic activity, with the index registering a 35-month low of 5.6% in February 2025, down from 9.4% in January 2025. This slowdown is attributed to weaker YoY growth across a majority of the constituent indicators, partially influenced by the base effect related to the leap year in 2024.

Key findings of the report include:

The year-on-year (YoY) growth in economic activity, as measured by the ICRA Business Activity Monitor – an Index of high frequency indicators, moderated sharply to a 35-month low of 5.6% in February 2025 from 9.4% in January 2025, amid weaker YoY growth performance across 10 of the 15 constituent indicators, partly reflecting the base effect related to the leap year in 2024. The average YoY growth in January-February FY2025 stands at 7.5%, lower than the 8.8% growth seen during Q3 FY2025. The early trends for March 2025 are mixed, amid an uptick in the growth in electricity generation and a deterioration in the growth performance of average daily vehicle registrations.

• YoY growth of ICRA Business Activity Monitor moderated to 5.6% in February 2025: After witnessing a robust performance in January 2025, the YoY growth in economic activity slowed in February 2025. The ICRA Business Activity Monitor rose by 5.6% in the month, the slowest pace in 35 months, although this was partly led by the unfavourable base effect owing to the leap year in 2024. There was a deterioration in the YoY growth for as many as 10 of the 15 constituent indicators in February 2025 vis-à-vis January 2025, including most automobile and mobility/transport-related indicators and non-oil exports. With this, the average growth in January-February FY2025 stands at 7.5%, trailing the growth of 8.8% seen during Q3 FY2025.
• MoM contraction in the index widened in February 2025 vs. February 2024: The index declined by 5.0% on a sequential basis in February 2025 as against the 1.7% fall seen in February 2024, partly on account of higher number of days in the latter month, with 2024 being a leap year. As many as eight of the 13 non-financial indicators witnessed a deterioration in their MoM performance in February 2025 vis-à-vis February 2024, with a particularly weaker performance in vehicle registrations, motorcycle production, non-oil exports, and GST e-way bills.
• Data for early-March 2025 is mixed: The average daily vehicle registrations stood at 49.9k units during March 1-18, 2025, ~20% lower on a MoM basis and ~27% lower on a YoY basis. In contrast, the YoY growth in electricity demand surged to an eight-month high of 6.7% during March 1-17, 2025 from 2.9% in February 2025, aided by above-normal temperatures and a greater number of heatwave days in the month

ICRA Business Activity Monitor is a composite indicator that comprises:

• Auto production (2Ws and PVs)
• Vehicle registrations Output of Coal India Limited (CIL)
• Power generation
• Non-oil merchandise exports
• Cargo handled at major ports
• Consumption of petrol and diesel

Finished steel consumption

• Generation of GST e-way bills
• Domestic airline passenger traffic
• Aggregate deposits and non-food credit of SCB