12 March 2023, Mumbai
India is home to 36 per cent of the world’s billionaires, these are the new Maharajas that are punters of all things luxury. According to the Frank Knight 2022 report, India ranks third globally in terms of billionaires, after US and China. A recently published Credit Suisse report corroborates – the number of Indian millionaires will increase 105 per cent in the next three years.India’s GDP is the fifth largest and defying global recession, continues with a growth of 7 per cent in 2023. Arecent EY report states, India’s GDP will reach $26 trillion and per capita income will touch $15,000 by 2047, placing it among the top developed economies. With such prosperity, can global luxury brands stay away?
The Indian luxury market is poised to grow 3.5 times its current size and reach a value of $200 billion by 2030, states a report from Bain & Company. The luxury market is being driven by the spurt of growth of ultra-high net worth individuals, who are valued at over $30 million in assets. The ultra-rich grew 11 times more in India in the last decade, spanning Tier I, II, III cities. Despite the current retail inflation, India’s luxury goods market generated revenue worth $7.5 billion in 2022.
Gold rush for international luxury brands
Iconic French luxury department store Galeries Lafayette announced its debut in India in partnership with Aditya Birla Fashion Retail. Offering a portfolio of over 200 luxury labels, Galeries Lafayette’s first stores opens in Mumbai and Delhi. Balenciaga is also ready to plunge in to the demand for luxury in India with the help of Reliance Brands and will open its first store in mid-2023. The Kering Group has had a robust relationship with Reliance Brands as it has already met success with the introduction of Valentino, Burberry and Jimmy Choo. Reliance Brands is perhaps the single largest retailer of luxury couture brands in India, with nearly 35 popular names under its umbrella, including Tiffany & Co., Salvatore Ferragamo, Ermenegildo Zegna, Tory Burch, Tod’s, Versace, Michael Kors and Bottega Veneta. The market's largest segment is luxury watches and jewelry with a market volume of $2.24bn in 2023.
Luxury sectors that top growth in India
Luxury homes have been the ultimate lifestyle statement and whilst the India neo-rich can’t claim heritage palaces, they are buying of luxury properties, particularly in metros, Tier 2 towns and at holiday destinations. Whilst 11 per cent of the wealthiest of Indians prefer owning luxury homes abroad, Mumbai, Delhi, Bengaluru, Hyderabad and Goa remain the top five Indian places for luxury homes, farm houses and holiday villas.
Luxury cars are another segment signaling excellent growth prospects. The case in point here is the year 2022. 38,000 luxury vehicles were sold in India that year, registering a 50 per cent rise compared to 2021.
Experiential luxury has really taken off amongst well-heeled Indians as they seek exclusive and customized experiences in the most exotic settings. Be it a personal holiday or a wedding, luxury destinations that offer the finest and the rarest are topping the preference charts. From the finest local cuisine and libations to the best crafted décor items and luxury fashion, Indian travellers are spending on travel experiences and are also showing their interest in sustainable travel.
Indians have definitely arrived in the contemporary luxury world as is evident from all major international labels are making a beeline for destination India.
