Retail

India's retail consumption soars in H1 FY23: CMS

07 Jan '24

2 min read

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Insights

India's retail consumption rose sharply in H1 FY24, especially in e-commerce and SURU areas.
The Retail Consumption Trends indicator shows a 9.3 per cent increase in B2C across 11 key sectors.
E-commerce surged by 19.4 per cent in Q2 FY24 due to high consumer demand and lower inflation.
Large format retail grew 7.8 per cent, driven by rising incomes.

The retail consumption across India has shown a significant upsurge, particularly in the e-commerce and semi-urban and rural (SURU) sectors, according to the findings of the Retail Consumption Trends indicator released by CMS Info Systems. The indicator reveals that India’s retail consumption in the B2C segment has witnessed a robust annual increase of 9.3 per cent in the key 11 sectors first half of the financial year 2024 (H1 FY24).

One of the standout performers in this period has been the e-commerce sector. It experienced an exceptional annual increase of 19.4 per cent during the second quarter of FY24 (Q2-FY24). This surge is attributed to the rising consumer demand in these sectors, which comes amid a period of easing inflation.

In contrast, the large format retail sector, while still showing positive growth, has experienced a more modest annual increase of 7.8 per cent in the second quarter Q2 of FY24. This growth is driven by various factors, including rising incomes, urbanisation, and evolving consumer preferences, as per CMS Info Systems.

From a demographic perspective, while metro cities had previously led the growth from Q2 FY23 to Q1 FY24, they were outpaced in H1 FY24 by the semi-urban and rural (SURU) areas. The SURU regions saw the fastest consumption growth at 9.2 per cent year-on-year (YoY), triggered by improved discretionary spending.

Looking ahead, higher GDP and softening inflation are expected to catalyse retail consumption growth in Q3 FY24 aided by festival and wedding season.

Fibre2Fashion News Desk (DP)

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