India Retail Report

The retail market in the country is expected to be worth over Rs 18,10,000 crore by 2010. And organised retail is likely to exceed Rs 2,30,000 crore (at constant prices), at about 13% of the pie, according to India Retail Report (2009 edition).RS Roy, editorial director, India Retail Report 2009 said, “Our research estimates the Indian retail market in 2007 at Rs 13,30,000 crore, growing annually at 10.8%. The share of organised Retail in 2007 was estimated to be only 5.9%, or Rs 78,300 crore. Modern retail witnessed a growth rate of 42.4% in 2007 and we envisage it to maintain a faster growth rate over the next three years. Increase in consumer spending is and will push the economy into a growth-and-liberalisation mode.”In the overall retail pie, food and grocery was the dominant category with 59.5% share, valued at Rs 7,92,000 crore, followed by clothing and accessories with a 9.9% share at Rs 1,31,300 crore. Interestingly, out-of-home food (catering) services (Rs 71,300 crore) has overtaken jewellery (Rs 69,400 crore) as the third-largest retail category, with a 5.4% market share. Consumer durables (Rs 57,500 crore) is the fifth-largest retail category, followed by health and pharmaceuticals (Rs 48,800 crore), entertainment (Rs 45,600 crore), furniture, furnishings and kitchenware (Rs 45,500 crore), mobiles and accessories (Rs 27,200 crore), leisure retail (Rs 16,400 crore), footwear (Rs 16,000 crore), health and beauty care services (Rs 4,600 crore) and watches and eyewear (Rs 4,400 crore), in the order.In organised retailing, however, clothing and fashion accessories is the largest category with a market share of 38.1%, at Rs 29,800 crore, followed by food and grocery with 11.5% (Rs 9,000 crore), footwear 9.9% (Rs 7,750 crore) and consumer durables 9.1% (Rs 7,100 crore). Timewear (48.9%) and Footwear (48.4%) are the most organised of all retail categories, followed by clothing & fashion accessories (22.7%).At 25.6% year-on-year, the fastest-growing segment in the overall pie in 2007 was mobile and accessories followed by out-of-home food (catering) services (25.1%) and books, music & gifts leisure category (23.3%). In organised retail, however, the fastest growth was recorded in the tiny health and beauty care services category at Rs 660 crore, which grew 65%. The second-fastest-growing organised retail category was entertainment (53.8%), followed by the mobile phones and accessories (55.2%) and food and grocery retail (55.2%.At constant prices, growth in the fashion and accessories retail category, both in the overall market and the organised retail segment, have been consistently positive since 2004: while the overall market grew 12.8% in 2007, the organised segment grew 35.5%.In jewellery retail, the overall market growth was higher in 2007 (9.6%) as compared with the previous year (9.2%) but growth in organised retail was slightly lower (31%).The overall market growth in the timewear category has declined from 10.7% in 2005 to 9.7% in 2006 and further to 8.9% in 2007. However, growth in organised retail was higher in 2007 (16.6%, as against 14.8% in 2006). Footwear retail, the overall market as well as organised segment, grew faster year after year, but growth in 2007 has been remarkable. The overall market grew 12% in 2007 as against 9.2% in 2006, while the organised segment grew 42.3% and 36.4%, respectively. Growth in the health and beauty care has been optimistic, though the organised segment growth of 57.5% in 2007 was slightly lower as compared with 59.1% in 2006. In the furnishings and furniture retail category, the overall market grew at 7% in 2007 as against 3.2% in 2006 - thanks to the housing sector boom. The organised segment also grew faster at 29.7% in 2007 as against 23.1% the previous year. At constant prices, the overall food and grocery retail market grew slightly higher at 2.3% in 2007 as compared with 2.2% in the two previous years. The report suggests that the organised retail segment in this category is simmering in the true sense - a 50% growth in 2007 as against 42.9% in 2006, and lot more fireworks can be expected going ahead. Valued at Rs 9,000 crore, this organised market constitutes barely 1.1% of the total food and grocery retail market.