“One of the fastest growing segments in the domestic market today is the premium and super-premium end of the market, which is growing very rapidly. This is because the size of the market itself is growing very rapidly,” says India Apparel Report, published in Images Yearbook 2008.
According to research estimates, the premium and super-end market size would be anywhere between Rs 8,000 and Rs 10,000 crore, and it is growing at the pace of about 15-20 per cent y-o-y. It is likely to continue growing at the same pace as more and more consumers graduate to buying higher levels of merchandise and apparel. This consumption trend is primarily acting as a catalyst for the growth of this segment. Some observers believe that the luxury retail market can grow by as much as 50 per cent annually.
Opportunity-wise, the super-premium and luxury segment could offer one of the highest growth potentials to brands and retailers. Cashing in on this trend, retailers like Shoppers’ Stop are planning to enter the luxury retailing space in a major way. With a war chest of Rs 500 crore, the company had announced at the beginning of last year that it would open retail spaces exclusively for luxury brands such as Louis Vuitton, Gucci, YSL, Zegna, Hugo Boss and Mont Blanc.
In a way, this will be an extension to the retailer’s ‘duty free’ airport initiative in which its JV with Nuance Group has already bagged the contract for the international airport in Bengaluru.