In the run-up to Diwali, India Inc. was worrying about factors like the West Asia conflict, global uncertainty, and food inflation affecting festival sales. But three days before the big festival, there is optimism. Local factors like a favourable monsoon season have contributed positively to sentiment.
Kumar Rajagopalan, CEO, of the Retailers Association of India, said, “Consumer sentiment on the ground is looking positive with good footfalls visible at stores especially in the last 10-12 days. Categories related to the festival season including electronics, white goods, garments, furniture and furnishing are seeing a good uptick in sales during this period.”
Upbeat note
Key players in consumer durables and electronics said after a strong Navratri and Dussehra period, the demand momentum is continuing in the run-up to Diwali with strong double-digit growth.
Fumiyasu Fujimori, Managing Director of Panasonic Marketing India, PLSI said, “Festive season had already started on a positive note with Onam. During Navratri, we at Panasonic Life Solutions India have witnessed over 20 per cent growth y-o-y and are hoping for continued momentum this Diwali. Premiumisation continues to be the flavour this season. Whether it is offline or, online consumers are opting for higher ASP (Average Selling Price) products.”
“The south is performing exceptionally well, and the west is also showing strong results,” said B Thiagarajan, Managing Director of Blue Star India, a leading player in air conditioning and commercial refrigeration. “While there has been some rain in the east, overall demand during the festive season looks promising,” he added.
“We were bracing for the cyclone in the East but should be Ok now. Apart from the upcoming Dhanteras and Diwali, this trend (higher sales) is going to continue for the next 20 days,” CS Vigneshwar, President, of the Federation of Automobile Dealers Associations (FADA) told businessline. With healthy water levels in reservoirs and improved crop yields supporting rural demand, the festive season is expected to drive a substantial boost in two-wheelers, passenger vehicles, and tractor sales with new launches planned for the month, he added.
F&B woes
Not so optimistic are the retailers in the food and beverages segment in Hyderabad who seem to have taken a beating, while those in garments are better off. “The last four days have been slack as people buy other things (garments, electronics, jewellery) more during Diwali. We are seeing a drop of about 10 per cent in footfalls. We hope that sales will pick up in the next few days,” said an executive of Pure O’ Natural, which has about 50 stores in Hyderabad.
Other F&B retail chains too echoed this. “After a lull first week, we witnessed a 10-day rush during the Dussehra season. But it’s a different case as the Diwali season enters,” a store manager at Ratnadeep, a big retail network said.
Apparel players on the other hand are gungho. Sidhant Keshwani, Founder & CEO, Libas said, “This Diwali season is indeed showing strong potential to surpass last year’s performance in the apparel segment. We’ve observed a notable uptick in demand driven by a combination of factors: an overall boost in consumer sentiment, a return to traditional festive gatherings, and a clear preference for quality ethnic and fusion wear. Our festive sales this year have demonstrated significant growth over last year, with a 20 per cent increase in revenue through online channels and a notable 30 per cent growth through offline avenues.
Online scores
The story of this festival season is the strong showing of brands that climbed aboard the e-commerce wagon. Panasonic for instance said its ecommerce channel grew in double digits. An ITC spokesperson said, “Ecom channels continue to witness accelerated growth led by Quick Commerce which is contributing to almost half of our e-com sales.”
Commenting on the evolving retail ecosystem in India, Kapil Makhija, MD & CEO of Unicommerce said, “We have seen the entry of large legacy brands onto the e-commerce bandwagon in the last few years and this is a testament to India’s evolving retail landscape.”