India's economy is projected to maintain strong growth momentum in the second quarter of FY27 (Q2 FY27), with gross domestic product (GDP) likely expanding by approximately 7.8 per cent, according to a report released on Wednesday, 11 November 2026 by SBI Research. The estimate comfortably exceeds the Reserve Bank of India's (RBI) official forecast of 7.2 per cent for the same period, buoyed by resilient domestic demand, robust corporate earnings, and strong credit growth.

Key Growth Projections

SBI Research pegged nominal GDP growth at 11–11.5 per cent for Q2 FY27, while gross value added (GVA) growth is expected to exceed 8 per cent. The GVA deflator is estimated at 4.1 per cent and the GDP deflator at 3.4 per cent. Notably, real manufacturing GDP is likely to outpace nominal manufacturing GDP, as the manufacturing deflator remains in negative territory — a reflection of subdued output price inflation relative to production volumes.

Input Cost Pressures Persist

The report flagged that incomplete pass-through of input cost pressures continues to weigh on several manufacturing segments. "Despite the recent moderation in input-output price differentials, input prices continue to remain higher than output prices across several manufacturing sectors, indicating incomplete pass-through of input cost pressures by producers," the report noted. The gap is particularly pronounced in electrical equipment, computer, electronic and optical products, furniture, and fabricated metal products — sectors where margin compression could limit capex appetite going forward.

Corporate Performance and Banking Sector

Indian corporate performance in Q2 FY27 showed broad-based resilience, according to the report. EBITDA and PAT (Profit After Tax) of nearly 2,300 listed entities excluding the BFSI sector grew by 35 per cent and 33 per cent respectively in Q2 FY27 compared to Q2 FY26, signalling a sharp year-on-year improvement in operating and bottom-line profitability. On the banking front, strong credit growth helped public sector banks (PSBs) post healthy profits, reportedly outpacing their private-sector counterparts on asset quality metrics.

Agricultural Risk on the Radar

Despite the upbeat headline numbers, the report flagged geographically dispersed agricultural production risks across both Kharif and Rabi seasons. "The district-level assessment reveals that the potential agricultural production losses are geographically dispersed across both Kharif and Rabi seasons. During Kharif, the highest production losses are concentrated in districts across Rajasthan, Punjab, Uttar Pradesh and Maharashtra," the report said. This remains a contingent downside risk to rural demand, which has otherwise been a pillar of domestic consumption growth.

What This Means for the Broader Economy

An SBI Research estimate of 7.8 per cent GDP growth — if confirmed by official data — would represent a meaningful outperformance against not only the RBI's projection but also many international forecasters who have flagged global headwinds from slowing trade and geopolitical uncertainty. This comes amid continued resilience in India's services sector and sustained government capital expenditure. The official Q2 FY27 GDP data from the National Statistical Office (NSO) is expected in the coming weeks, and will serve as the definitive benchmark against which these projections are measured.