New Delhi, Feb 20 : The PMI data for February signalled stronger output growth as the HSBC Flash India PMI rose from 58.4 in January to 59.3 this month â?? indicating the strongest rate of expansion for three months, the data compiled by S&P Global showed on Friday.

The acceleration was driven by a quicker upturn in factory production, as growth of services activity was broadly similar to that registered at the start of the 2026 calendar year.

â??The manufacturing industry strengthened in February, supported by robust growth in output and new domestic orders,â?? said Pranjul Bhandari, Chief India Economist at HSBC.

At the composite level, Februaryâ??s expansion was the strongest since last September.

â??Both manufacturers and service providers were optimistic about the future, despite rising inflationary pressures,â?? Bhandari added.

Private sector companies in India welcomed quicker increases in total new orders and international sales during February, which prompted them to recruit additional staff and scale up output.

Also, businesses became more optimistic towards growth prospects. These improvements were accompanied by an intensification of inflationary pressures, with both input costs and selling charges rising at faster rates, said the report.

It further stated that similar to the trend for output, aggregate new orders increased at the fastest pace since last November.

Survey participants attributed growth to demand strength, local tourism, marketing efforts, and rising client enquiries. Goods producers signalled a stronger rise in total sales than services firms, and one that was the quickest in four months, as the latter saw growth retreat to a 13-month low.

Dampening the upturn were competitive pressures and the offer of cheaper services elsewhere, qualitative data showed.

â??One area where the service economy outperformed was exports, as international orders rose at a substantial pace that was the steepest since August 2025,â?? the data showed.

In addition to hiring additional staff, goods producers also scaled up purchasing volumes. Input buying growth climbed to a four-month high in February.

Still, data suggested that suppliers were comfortably able to deliver materials in a timely manner, with the current sequence of improving vendor performance stretching to two years. This aided firms' efforts to lift stocks of raw materials and semi-finished items, said the report.

/IANS