Indian men's ethnic wear stitching a profitable future
Indian men's ethnic wear category is experiencing major growth spurt, with a market size estimated to be over Rs 2.2 lakh crore ($30 billion) in FY2023. This segment, though comprising only about 6 per cent of the overall men's wear market, is projected to move forward at a Compound Annual Growth Rate (CAGR) of nearly 20 per cent for the next four years, as per consulting firm Technopak. This is significantly higher than the projected growth rate of the overall men's wear market.
A market poised for takeoff
The organized market currently has only a fraction of the total pie, with estimates suggesting it's around 30 per cent. This vast unorganized sector, pegged at roughly 70 per cent, presents a massive opportunity for established players and new entrants alike].
Several factors are fuelling this growth.
Rising disposable incomes: India's burgeoning middle class has more money to spend on discretionary items like ethnic wear.
Increased significance of occasions: Weddings remain a key driver, with a surge in demand for premium wedding wear showcasing a consumer desire for high-quality occasion wear.
Shifting consumer preferences: A growing fashion consciousness among men is leading them to experiment with ethnic wear for festivals, religious ceremonies, and even casual outings. Moreover, the increasing popularity of online shopping offers convenience and wider product selection, further accelerating market growth.
Growing investor interest
This robust growth potential is attracting significant investor interest. Several startups in the men's ethnic wear space have secured funding. For instance, Manyavar, a leading brand, has received multiple rounds of funding with their valuation touching Rs 1,500 crore ($206 million). Other notable names receiving investor backing include Veilcraft and Sherwani Studio.
These investments highlight the investor confidence in the sector's ability to generate significant profits. This robust growth potential is attracting significant investor interest. The Indian wedding industry alone is expected to reach Rs 5 lakh crore ($68.7 billion) by 2025. This translates to a lucrative market for premium menswear brands.
The business model of men's ethnic wear companies typically involves a high-margin strategy. The focus on premium fabrics, intricate designs, and occasion-specific wear allows brands to command premium prices. This, combined with a growing customer base, translates to promising profit margins and high valuations for successful companies.
The Indian men's ethnic wear industry is poised for big growth. With a large and expanding market, rising disposable incomes, and a shift towards online shopping, this sector offers a compelling proposition for investors and entrepreneurs alike.
