The Indian economy is expected to see an increase in consumption in the intensive contact sector in the coming months, the word new research by Quanteco.
This study analyzed the ‘Google search’ data from the top brand representative in various service segments to measure “consumption intentions”.
According to Yuvika Singhal, economists at the third quanteco research in the third quarter of FY22 will be “positive consumption”, allowing GDP to grow in sequence.
Analysis by Quanteco shows that consumers have begun to move out and spend.
Enasting restrictions related to locking, the Covid case remains benign and progress on vaccination, has enabled this together with the celebration season that acts as a “additional kicker”.
It seems that the combination of hidden requests and retaliation is formed, said Singhal.
Data ‘Google search’ shows that the intensive contact sector contacts lead a rebound.
For example, it shows that the search for websites such as ‘MakemyTrip’ and ‘Bookmyshow’ have seen a surge in 8 to 12 weeks.
Other search terms such as Nykaa (indicators for beauty products), oyorooms (an indicator for hotels / rooms), pepperfry (for home improvement) has also seen an increase in the last 2-4 weeks.
“This is the indication of the extent of consumption intent in the celebration season,” Singhal said.
Data for this high frequency indicator has been analyzed from February 2020 and so on.
Asked about the pre-Pandemic era data, Singhal said that the comparison might be one between apples and oranges.
“The consumption and utlilization pattern of services has changed substantially due to pandemic.
For example, previous people who are satisfied using public transportation services now want to buy their own vehicle to avoid contact with a larger crowd,” he told Ti.
In the future, Singhal expects consumption momentum in Q4 to rise when India moves closer to fully incorporating 100% of the population of adults.
“The increase in vaccination coverage will also stand up to blunt the economic impact of the next covid waves, if any,” he said.
“The extension of consumption momentum is currently Q4 FY22, it will determine the temporary recovery resistance also paves the way to increase capacity utilization and in the rotation in the Capex cycle in FY23,” he explained.
Quanteco predicts 10% FY22 GDP growth with a mild downside risk.
The global energy crisis and supply disruptions need to be considered in that context, Singhal said.
The RBI in its monthly papers on the economic situation also noted that part of the service sector recorded Y-O-Y strong growth, as shown by improvement in trade, hotel, transportation and communication, and also reflected in the GST e-way bill.
This paper also noted that after continuing contractions during May-July 2021, PMI services were expanded sequentially in August-September.
The reopening of outlets and increasing footsteps increases service consumption, notes rbi.