A vegetable vendor waits for customers at a market in the western Indian city of Ahmedabad. File/ Reuters
V Nagarajan
After facing a series of lockdowns and disruptions in consumption due to the Covid-19 pandemic, the Indian retail industry appears to be back on track with consumption crossing or about to reach pre-pandemic levels in all the regions.
The share of organized retail in the Indian retail industry has comparatively increased in recent years and is expected to grow further in the coming years, according to the Knight Frank India survey.
In March 2022, all categories, except accessories, had already exceeded the pre-Covid-19 sales level.
For the past four years, electronics outpaced sales growth, even during COVID-19-affected periods, driven primarily by the WFH trend and consumers switching to premium products.
The food and beverage (F&B), apparel and department store categories show a healthy recovery after the third wave as consumers return to the “old normal” way of shopping.
Consumption growth across all regions and categories as normalcy returns is a huge relief to retailers and will help them meet their contractual obligations to mall operators over time.
The Covid-19 pandemic caused most industries to collapse under the threat of an economic slowdown and the story of the Indian retail sector was no different. Despite the adverse impact of Covid-19 in FY2021, India’s organized retail sales are expected to multiply over the next six years.
With economic growth, organized retail sales will also witness tremendous growth and move up the growth curve at a CAGR of 17% during the 2022-28 fiscal year period. Evolving consumer spending patterns and rising levels of disposable income are redefining the retail landscape in India.
The retail industry will continue to account for 10 per cent of India’s GDP over the next five financial years.
The share of organized retail sales is derived from the size of the retail industry.
These assumptions and variables were verified with various retail industry experts.
Organized retail sales grew at a CAGR of 24% between fiscal years 2017 and 2022. Growth factors such as healthy economic growth, increased retailer confidence, confidence in downtown development commercials and rising disposable incomes of Indian consumers accelerate volume further. heights in fiscal year 2023.
However, the threat of restrictions due to the waves of Covid-19 and geopolitical tensions may continue to persist in fiscal year 2023.
Organized retail sales volume is estimated to grow at a CAGR of 17%, from $52 billion in FY2022 to $136 billion in FY2028.
Shopping malls were on the receiving end of a major setback due to the sudden closure during the Covid-19 lockdowns.
Potential consumption in malls in the top 8 cities is estimated to grow at a CAGR of 29% in the FY2022-28 period, reaching $39 billion by FY2028.
This high revenue growth in shopping centers is projected largely due to increased supply from shopping centers over the next six years, coupled with the support of growing consumer demand.
The entry of new brands in the market, changing demographic profiles and the evolution of consumer tastes and preferences are expected to sustain this growth in consumption.
The long-term outlook for the shopping mall business in India remains promising for the coming years.
I have been in the Gulf for 10 years and would like to invest in real estate with my brother who is in India. Can he invest in the acquisition of the property? Selvyn, Sharjah
Yes. Under the Liberalized Remittance Scheme, your brother can invest abroad up to $250,000 per financial year. It can be used for various purposes, including property investment.
Keep in mind, however, that nightclubs aren’t allowed for capital account transactions, like buying property, if your sibling isn’t a co-owner of the property.
We are in the process of selling our late father’s property in India with three legal heirs there and I am located in the Gulf. Is a power of attorney enough to resolve the situation? Sharan Gouda, Dubai.
Yes. You will need to obtain certification of the specific power of attorney in the Gulf with the Indian consulate. You can grant PoA to any of the three legal heirs in India for the purpose of executing and registering the deed of sale. Once received in India, it must be stamped and signed with the appropriate stamp duty.
