62 pc of Indian SMEs expect sales growth in Q2 FY26: Report

New Delhi, Aug 26 Around 62 per cent of small and medium businesses in India anticipate sales volume to grow in the July-September quarter of CY 2025, a report said on Tuesday.

Around 56 per cent of respondents reported growth in new export orders, indicating a shift towards global markets to diversify revenue, said a report co-authored by ASSOCHAM with Dun & Bradstreet India.

As many as 57 per cent of businesses indicated selling prices to increase, suggesting that firms are managing to sustain pricing levels despite competitive pressures, the report said.

Net profit expectations have, however, declined, with 36 per cent of firms anticipating an increase, down from 83 per cent in the April-June 2025 quarter.

Sentiment around raw material prices improved, with 8 per cent of respondents expecting lower prices in the July-September quarter 2025 compared to 2 per cent in the previous April-June quarter 2025.

"Stability in selling prices and easing input cost pressures are supporting margin predictability. Meanwhile, prudent inventory management and a stable employment outlook underscore operational resilience," Dun & Bradstreet India Managing Director, Avinash Gupta, said.

Around 60 per cent of businesses expected an increase in inventory levels of raw materials and work in progress. Hiring sentiment remained strong, with 68 per cent of respondents expecting an increase in the total number of employees. However, 19 per cent of respondents reported an inability to find appropriate talent, an increase from 9 per cent last quarter.

Insufficient demand remains a key limiting factor, reported by 18 per cent of small and medium businesses, a sharp increase from 7 per cent in the previous quarter, the report said.

Cooling inflation, prospects of continued monetary easing, and a promising start to the monsoon season together set a favourable tone for growth and recovery in the coming quarter, the report noted.

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