The HSBC Flash India Composite Purchasing Managers Index (PMI) is a key economic indicator and a seasonally adjusted index that measures the month-on-month change in the combined output of India's private sector. Its headline figure is the Composite Output Index. The index is a concept used by analysts to gauge the health of the Indian economy.
The index is compiled by S&P Global from responses to questionnaires and is sponsored by HSBC (The Hongkong and Shanghai Banking Corporation Limited). It was created to provide an advance indication of business trends, with historical data for the Composite PMI averaging from 2013 to 2026. The "Flash" component means the data is released approximately one week before the final indices, based on an early collection of around 75%–85% of the total survey responses.
The mechanism involves calculating a weighted average of the Manufacturing Output Index and the Services Business Activity Index. The data is collected from a panel of approximately 800 companies, split between around 400 manufacturers and 400 service providers. The index tracks variables such as sales, new orders, employment, inventories, and prices. A reading above 50 signals an expansion in private sector activity compared to the previous month, while a reading below 50 indicates a contraction.
The Composite PMI connects directly to its sub-indices: the Manufacturing Purchasing Managers' Index™ (PMI) and the Services Business Activity Index. The methodology for the flash estimates is identical to that used for the final PMI indices. The index is a crucial tool for economists, such as Pranjul Bhandari, Chief India Economist at HSBC, to comment on the pace of growth, inflation, and business confidence in the Indian private sector.