SBI, in its Ecowrap report, projected India's GDP growth for FY22 at 8.5% and Q4 FY22 at 2.7%, though it believes the projection for the Jan-March quarter is clouded by significant uncertainties. The Q4 FY22 GDP numbers are due for release on May 31.

Explaining the rationale behind the difficulty in predicting the fourth-quarter numbers, the SBI report cites a spate of customary quarterly revisions in FY22 for not being able to accurately forecast the growth.

“For example, even a 1% downward revision in Q1 GDP estimates of FY22 from 20.3%, all other things remaining unchanged could push Q4 GDP growth to 3.8%,” the report says.

Nevertheless, the FY22 GDP numbers could move closer to 8.5% as the Q4 GDP numbers as per the SBI nowcasting model, says the SBI Research report.

India's gross domestic product (GDP) in the third quarter of the financial year rose 5.4% year-on-year to ₹38.22 lakh crore. For fiscal 2021-22, the real GDP growth estimate was revised by the Centre downwards to 8.9% compared with the earlier forecast of 9.2%. The government’s estimate is 1.8% above the pre-pandemic (2019-20) level.

According to SBI, the other big puzzle could be the gap between GVA and GDP numbers in Q4, given the strong growth in tax collections. “This could push up the GDP number significantly, even as GVA might be much lower,” the report flags.

Leading ratings agency ICRA this week also said the GDP growth and gross value added (GVA) at basic prices in Q4 seem to have eased to a tepid 3.5% and 2.7%, respectively. Prime reasons for slower recovery are believed to be higher commodity prices on margins, a decline in wheat yields and the hiccups in the contact-intensive services amid Covid-19 and a high base.

The early trend of Q4 FY22 financial results by listed companies reported better growth numbers across parameters as compared to Q4 FY21, despite a contraction in operating margin due to higher input cost.

Q4 Fy22 GDP data

FY22 GDP growth to be at 8.2-8.5%; uncertainties plague Q4 numbers: SBI