Quarterly Order Books, Inventories
and Capacity Utilisation Survey:
April-June 2012 (18th Round)*
This article, fifth in the series, presents the findings
of Order Books, Inventories and Capacity Utilisation
Survey (OBICUS) conducted for Q1:2012-13. The survey
results indicate that growth of new orders on a year on year
(y-o-y) basis, which was declining across the quarters of
2011-12, increased in Q1:2012-13 partly due to lower
base. Capacity Utilisation (CU), however, moderated
to the lowest level of the 13 quarters in Q1:2012-13.
Finished goods inventory to sales ratio and raw material
inventory to sales ratio increased in Q1:2012-13 over
the previous quarter.
I. Introduction
The Reserve Bank has been conducting the
OBICUS on a quarterly basis. The survey scheduled
is canvassed among 2,500 public and private limited
companies in the manufacturing sector with a good
size/industry representation. The survey captures
the movements in order books, inventories and
capacity utilisation which are important indicators
of economic activity, inflationary pressures and
overall business cycle. The information collected in
the survey includes quantitative data on new orders
received during the reference quarter, backlog orders
at the beginning of the quarter, pending orders at the
end of the quarter, total inventories with breakup of
work-in-progress and finished goods inventories at
the end of the quarter and item-wise production in
terms of quantity and values during the quarter vis-à-
vis the installed capacity from the targeted group.
The level of CU is estimated from the above data as
per the selected methodology1. Trend analysis is done to study the movements in order books, CU and
inventories based on a common set of companies in
each round to facilitate better comparability of data
over the reference quarters. In the current survey,
for Q1:2012-13 (18th Round), 1,154 manufacturing
companies responded, of which 47 were Government
companies, 817 were public limited companies and
290 were private limited companies2. The analysis is
based on the data provided by these companies for
the last 13 quarters i.e., Q1:2009-10 to Q1:2012-13.
The data tables are given in Annex.
II. Findings of Survey
II.1 Order Books
Average new orders of 467 respondent companies
increased by 3.0 per cent in Q1: 2012-13 over the
previous quarter (Chart 1, Table 1). The y-o-y growth
of new orders at 19.4 per cent was higher than that
observed in the recent past and may partly be due to lower base. It was also observed that the pending
orders increased possibly due to inability to fully meet
the new orders.
II.2 Capacity Utilisation (CU)
CU level of the respondent companies declined
from a high of 79 per cent recorded in Q4:2011-12
(partly reflecting seasonality) to 72.9 per cent in Q1:
2012-13. The current CU level is the lowest in last
13 quarters. The movement of CU is in line with
de-trended Index of Industrial Production (IIP) for
manufacturing sector (Chart 2, Table 2).
II.3 Inventories
Both the average finished goods (FG) inventory
and average raw material (RM) inventory of 906 respondent companies grew at higher rates during
Q1: 2012-13 as compared with those in the previous
quarter. This has reversed the moderation in FG
inventory to sales ratio observed during Q4:2011-12.
RM inventory to sales ratio rose noticeably in Q1:
2012-13 (Chart 3, Table 3), which may be partly due to
higher new order growth.
III. Conclusion
There is some evidence of pick-up in the new
orders in the manufacturing sector. However, this has
not been reflected in the level of capacity utilisation
which remained at the lowest level in 13 quarters.
Increase in pending order and higher RM to sales ratio
could possibly be due to a lag in servicing the new
orders during the quarter.
Annex – Data Tables
Table 1: Order Books (Q1: 2009-10 to Q1: 2012-13) |
Quarter ended |
Amount in ` billion |
Q-o-Q growth (%) |
Y-o-Y growth (%) |
Avg Backlog order (467) |
Avg New Order book (467) |
Avg Pending order (467) |
Avg Backlog order |
Avg New Order book |
Avg Pending order |
Avg Backlog order |
Avg New Order book |
Avg Pending order |
Q1:2009-10 |
1.49 |
0.95 |
1.51 |
|
|
|
|
|
|
Q2:2009-10 |
1.51 |
1.05 |
1.55 |
1.2 |
9.8 |
2.4 |
|
|
|
Q3:2009-10 |
1.55 |
1.09 |
1.58 |
2.5 |
4.5 |
2.3 |
|
|
|
Q4:2009-10 |
1.59 |
1.14 |
1.58 |
2.6 |
4.2 |
0.2 |
|
|
|
Q1:2010-11 |
1.55 |
1.08 |
1.56 |
-2.4 |
-5.2 |
-1.7 |
3.9 |
13.4 |
3.3 |
Q2:2010-11 |
1.56 |
1.17 |
1.61 |
0.6 |
8.3 |
3.1 |
3.3 |
11.8 |
4.0 |
Q3:2010-11 |
1.61 |
1.30 |
1.69 |
3.2 |
11.0 |
5.1 |
3.9 |
18.7 |
6.8 |
Q4:2010-11 |
1.69 |
1.40 |
1.71 |
5.3 |
7.9 |
1.1 |
6.6 |
22.8 |
7.7 |
Q1:2011-12 |
1.69 |
1.25 |
1.69 |
-0.2 |
-10.8 |
-0.8 |
9.1 |
15.6 |
8.7 |
Q2:2011-12 |
1.69 |
1.32 |
1.68 |
0.2 |
5.7 |
-1.1 |
8.7 |
12.9 |
4.3 |
Q3:2011-12 |
1.67 |
1.41 |
1.75 |
-1.2 |
6.7 |
4.2 |
4.1 |
8.6 |
3.4 |
Q4:2011-12 |
1.75 |
1.45 |
1.71 |
4.5 |
2.8 |
-1.9 |
3.3 |
3.5 |
0.3 |
Q1:2012-13 |
1.71 |
1.49 |
1.75 |
-2.2 |
3.0 |
2.2 |
1.1 |
19.4 |
3.3 |
Table 2: Capacity Utilisation & Index of Industrial Production (Manufacturing) (Base: 2004-05=100) |
Quarter |
Q1:
2009-10 |
Q2:
2009-10 |
Q3:
2009-10 |
Q4:
2009-10 |
Q1:
2010-11 |
Q2:
2010-11 |
Q3:
2010-11 |
Q4:
2010-11 |
Q1:
2011-12 |
Q2:
2011-12 |
Q3:
2011-12 |
Q4:
2011-12 |
Q1:
2012-13 |
CU (%) |
73.3 |
78.9 |
80.1 |
79.3 |
74.7 |
76.1 |
78.0 |
81.9 |
76.3 |
75.8 |
76.2 |
79.0 |
72.9 |
IIPMFG (Qtly avg : Base 2004-05) |
149.9 |
158.1 |
162.0 |
175.1 |
165.4 |
169.8 |
176.8 |
190.7 |
178.2 |
175.5 |
178.8 |
191.4 |
176.7 |
De-trended Qtly. IIPMFG |
-10.0 |
-4.4 |
-3.0 |
7.7 |
-4.4 |
-2.4 |
2.3 |
13.9 |
-0.9 |
-5.8 |
-4.7 |
5.7 |
-10.9 |
Table 3: Average Sales and Inventories and their ratios (Q1: 2009-10 to Q1: 2012-13) |
Quarter ended |
Amount in ` billion |
Ratio (%) |
Avg Sales (906) |
Avg Total Inv (906) |
Avg FG Inv (906) |
Avg WiP Inv (906) |
Avg RM Inv (906) |
Total Inv/Sales |
FG Inv/ Sales |
RM Inv/ Sales |
Q1:2009-10 |
2.45 |
1.36 |
0.46 |
0.21 |
0.69 |
55.5 |
18.9 |
28.2 |
Q2:2009-10 |
2.80 |
1.43 |
0.53 |
0.22 |
0.69 |
51.1 |
18.7 |
24.6 |
Q3:2009-10 |
3.00 |
1.46 |
0.49 |
0.23 |
0.74 |
48.7 |
16.5 |
24.7 |
Q4:2009-10 |
3.22 |
1.54 |
0.51 |
0.22 |
0.82 |
48.0 |
15.8 |
25.5 |
Q1:2010-11 |
3.15 |
1.61 |
0.56 |
0.24 |
0.81 |
51.1 |
17.9 |
25.6 |
Q2:2010-11 |
3.28 |
1.69 |
0.59 |
0.26 |
0.84 |
51.5 |
18.0 |
25.7 |
Q3:2010-11 |
3.54 |
1.80 |
0.50 |
0.26 |
1.04 |
50.8 |
14.2 |
29.3 |
Q4:2010-11 |
3.97 |
1.93 |
0.66 |
0.30 |
0.97 |
48.7 |
16.6 |
24.5 |
Q1:2011-12 |
3.97 |
2.01 |
0.71 |
0.29 |
1.01 |
50.8 |
18.0 |
25.5 |
Q2:2011-12 |
3.99 |
2.03 |
0.75 |
0.31 |
0.97 |
50.8 |
18.8 |
24.2 |
Q3:2011-12 |
4.25 |
2.13 |
0.80 |
0.32 |
1.02 |
50.2 |
18.8 |
24.0 |
Q4:2011-12 |
4.66 |
2.29 |
0.76 |
0.33 |
1.20 |
49.1 |
16.4 |
25.6 |
Q1:2012-13 |
4.46 |
2.57 |
0.85 |
0.38 |
1.35 |
57.7 |
19.0 |
30.4 |
FG: Finished Goods.
WiP: Work in Progress. RM: Raw Material. |
|