Independence Day fuels a revival in retail sales
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Independence Day discounts have lifted footfalls and sales by 8-10% YoY across key retail destinations in the country, with a revival in entry-to-mid segment demand raising hopes of a strong festive season.Sales of electronics, particularly in the more affordable segments, groceries and apparel have picked up, while restaurants are benefiting from higher mall traffic boosted by new movie releases and a rise in in-home dining orders, industry executives said.'After several months, there is good demand for entry to mid-segment products,' said Nilesh Gupta, director at electronic retail chain Vijay Sales Walk-ins are good and there is over 8% jump in sales value over last year, which is better than last year, he added.Electronic companies and grocery retailers run promotional offers specifically for the Independence Day eve--one of the largest consumption periods, along with the Republic Day sales, after the festive season.At India's largest retailer Reliance Retail, sales grew in double digits over last year, an executive said.It has been running I-day promotional offers across the consumption basket—electronics, groceries and fashion, and keeping stores open from early morning till late night.Haier India president Satish NS said the electronics manufacturer's I-Day sales are up over 20% compared to last year, with most categories driving sales.Tata-owned ecommerce app BigBasket reported a 42% on-year increase in patriotic merchandise sales on Friday, apart from a surge in sales of electronics including iPhone 16.Malls said footfalls have surged due to long weekends, discounts on offer, and new movie releases, powered by Rajinikanth's Coolie and Hrithik Roshan's War 2.'The crowd that comes for the movie adds at least 10% of the revenue for fashion brands, food and beverages,' said Harsh V Bansal, cofounder of Unity Group, which operates over half a dozen malls in Delhi and Punjab. 'The next few days also look good in terms of footfall and sales,' he said.For the first time since the Covid-19 pandemic, theatres are seeing back-to-back movies going housefull, Bansal said.Most of the I-Day offers are continuing till the weekend.'International brands have contributed to the growth with consumers using the lower price point during the sale to buy products,' said Muhammad Ali, chief executive, retail, at Prestige Group, which operates five malls in South India. These malls have seen a 15% on-year growth in sales. 'One segment which has not done well is Indian women's wear, which is a cause of worry,' Ali said.Retailers and brands have been struggling with discretionary sales for the last 9-10 quarters, as low-to-middle-income consumers remained hard-pressed by high inflation and sluggish earnings growth. Higher spending on travel and tourism by many consumers also impacted retail sales, executives said.Chief executives, however, have forecasted a recovery in consumption in the second half of this fiscal, aided by low inflation, low interest rates on loans, a reduction in income-tax rates this year and good monsoon rains.'While middle class discretionary spending was under pressure, some consumption has started and with the festival tail wind, the outlook is much better,' said Anjan Chatterjee, managing director of Speciality Restaurants , which operates chains like Mainland China and Oh! Calcutta.The trend during Independence Day has been reassuring, with a 15-18% year-on-year growth, he said.The government on Friday said GST rates will be rationalised to enhance affordability, boost consumption, and make essential and aspirational goods more accessible to a wider population by Diwali which too will bring back demand.There has been optimism across companies with sales during June and July improving sequentially after intermittent rains and early onset of monsoon impacted sales in the April-May period.
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