Industrial Production Index (IPI) – May 2012

Industrial Production Index (IPI) – May 2012
Recovery in Mining index push IPI growth


Above expectation – May’s Industrial Production Index (IPI) recorded 112.8 points, an increase of 8.0% y-o-y
and a 3.5% m-o-m. Such result is above our forecast of 105.0 to 108.0.

We reckon a better result of IPI in May’12 was due to lower base that recorded last year (May’11: 104.4) as well
as manufacturing order back to pre-flood level from Thailand, which is the largest Malaysian export partner in
May’12.


Mining index posted positive growth – Mining index in May’12 grew 13.8% y-o-y and 1.2% m-o-m to 85.0.
Such result was due to the increment in both crude oil index (14.6% y-o-y) and natural gas index (5.2% y-o-y).
Among factors that attribute to an increase in oil and gas productions was due to recovery of oil field production on
the east coast of Peninsular Malaysia from severe disruption that occurred last year.


Manufacturing index expanded – Manufacturing index rose 6.4% y-o-y and 3.9% m-o-m to 124.0.

We reckon manufacturing index performed well on yearly basis was due to several aspects such as recovery of
supply chain in manufacturing industry following the Japanese earthquake last year, manufacturing order back
to pre-flood level from Thailand and the robust demand on raw metal products.

Electricity index improve as well – Electricity index registered 135.8, up 6.6% y-o-y and 5.7% m-o-m. We
believe the increment in Electricity index was highly correlated with the improvement in Manufacturing index.

External headwind continue pose risks to June’s IPI - With the slowdown in economic activity in
developed nations and countries in emerging market, we expect IPI in June to drop between 108 and 110.

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damn good numbers

haha