India: Unprecedented growth in luxury categories

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Written by Linda Hohnholz

NEW DELHI, India – The Indian luxury market is estimated to be worth USD18 billion by 2017 from the current level of USD14 billion with unprecedented growth in luxury categories including fashion, aut

NEW DELHI, India – The Indian luxury market is estimated to be worth USD18 billion by 2017 from the current level of USD14 billion with unprecedented growth in luxury categories including fashion, automobiles and fine dining.

This was among the findings of a joint study conducted by The Associated Chambers of Commerce & Industry of India (Assocham) and Yes Bank.

The report noted that the market is poised to expand three-fold in next three years as the number of millionaires are expected to multiply three times in another five years.

D S Rawat, Secretary General ASSOCHAM, said during the release of the study that while various estimates exists on the size and growth potential of the Indian luxury market, most estimates align on anticipated growth rates of 20 percent given the tremendous potential of products such as: apparel and accessories, pens, home dรฉcor, watches, wines and spirits, and jewellery; services such as spas, concierge service, travel and tourism, fine dining and hotels; and assets such as yachts, fine art, automobiles and real estate.

The number of Ultra High Net (UHN) worth households, with a minimum net worth of Rs 25 crore (USD4.02 million) is expected to triple in next five years with a five-fold increase in their net worth to Rs 260 trillion (USD4.1 trillion). HNIs will be double in number by 2015 with a collective wealth of USD2,645 billion.

“These projections along with the increasing price parity in the luxury products with other international destinations like Singapore or Hong Kong, and customized products offerings would indicate that the luxury market in India would evolve quickly,” the report added.

The survey conducted between September 2014 to January 2015 captured the viewpoints of close to 300 executives from India, United States, United Kingdom, Italy, France and Belgium.

The study also concluded that high Internet penetration across tier-II and tier-III cities along with high disposable income shall lead to approximately 80 million transactions on the Internet by 2020. As a result, luxury consumption is going to increase manifold in the country.

The growing exposure of international brands and the desire to indulge in luxury has penetrated smaller cities and towns of India. Sixty-six percent of those surveyed do see themselves increasingly using social media platforms as a brand connect and to increase awareness within this new target segment.

Overall, ASSOCHAM said the report established that Indian consumer spending is expected to grow fourtimes to USD4.2 trillion by 2017.

About the author

Avatar of Linda Hohnholz

Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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