The state of Rajasthan, also known as the ‘Land of Kings’ is gradually on its way to becoming a powerhouse of modern retail in India. The economy of Rajasthan is the seventh-largest state economy in India with ₹10.20 lakh crore (US$140 billion) in GDP and a per capita GDP of ₹118,000 (US$1,700). The state ranks 29th among the states in human development index. Gross State Domestic Product (GSDP) of Rajasthan expanded at a CAGR of 10.63 percent between 2015 and FY2021. In 2019-20, the services sector contributed 46.63 percent to the state’s GSDP, followed by industries (27.81percent) and agriculture (25.53 percent).
Covering an area of 342,239 sq. kms or 10.4 percent of the total geographical area of India, Rajasthan is the largest Indian state by area and the seventh largest by population. This means it has a very high consumption rate. The state has been a stronghold on traditional and domestic retail for decades now. Add to this the rise of new infrastructure in the form of shopping malls and high streets, Rajasthan is fast becoming a retail destination with local flavors intact.
Retail has always been the backbone here, and in fact, the state is one of the oldest homes to traditional retail in India. It has its roots in history when trading and business attracted many invaders and rulers to this part of the country. It won’t be wrong to say that traditional and unorganised retailers dominate state’s retail sector. Kiranas and mom-and-pop stores have huge influence here and the major section of the retail market is ruled/owned by families and independent business models, offering a wide variety of items in both urban and rural areas.
Modern Retail & Industry Watch
The Indian retail industry has finally started moving towards modernisation after years of unorganised retailing and scattered ‘kirana’ shops. The modernisation movement is driven by new marketing models such as department stores, hypermarkets, supermarkets, and specialty shops. In Rajasthan, the retail model is such that it quickly captures customer minds. In fact, the organised retail sector is projected to increase exponentially in the next five years. However, market needs vary from one area to the next and from one city to another. Since there is a huge influence of domestic and traditional products in the market, consumer behaviour or predicted behaviours of those choices vary a lot.
“Being the seventh most populated state in the country, the state has huge potential for retailers to invest in real estate. Factors like absence of property tax, low stamp duty, low establishment cost, presence of international airport at Jaipur and major tourist traffic; make Rajasthan an attractive investment hotspot,” says Shubhranshu Pani, MD (Retail Services), JLL India.
Major Retail Destinations
Rajasthan is divided into 33 districts within seven divisions, out of which there are certain cities which are rising in the charts to become top retail destinations in Tier II & III cities. As per JLL, Retail, real estate in Rajasthan consists of organised high streets, local markets and shopping malls. High streets are predominant in Rajasthan specialising in local handicrafts and textiles. Brand stores have also made their presence felt in high streets of Jaipur like MI Road and C-Scheme. Brands like Zara, Marks and Spencer, Aldo, Forever New, Lifestyle, Central and Shoppers Stop have presence in Jaipur which is an emerging Tier-II retail destination in the country.
Jaipur ranks first in potential for retail growth among top thirteen Tier II and Tier III cities of India. Jaipur, Udaipur, Kota are some of the emerging cities which have reported a good growth and consumption rate in past few years.
Jaipur: Jaipur is the capital and the largest city of the state. It is also known as the Pink City, due to the dominant color scheme of its buildings. Jaipur is a popular tourist destination in India and also serves as a gateway to other tourist destinations in Rajasthan. The economy of Jaipur is fueled by tourism, gemstone cutting, the manufacture of jewellery and luxury textiles, and information technology. The city is a major hub for arts and crafts. It has many traditional shops selling antiques, jewellery, handicrafts, gems, bangles, pottery, carpets, textiles, leather and metal products. It is also s one of India’s largest manufacturers of hand-knotted rugs. Jaipur is as modern as any other metropolitan city in India. It has seven shopping malls that house some of the most prominent Indian and international brands.
Jodhpur: Jodhpur is the second-largest city and officially the second metropolitan city of the state. Jodhpur retail comprises spices, accessories, footwear, jewellery (mostly silver), silk, handicrafts and fabric.
Kota: Kota is a famous shopping center for the tourists. The markets are popular for crafts goods and some impressive collections of diversified Rajasthani products. The other shopping items of Kota markets are pottery, paintings, and stone crafts. The Kota sarees mainly attract women tourists from around India. Amongst the various types of Kota saris, the more popular ones are hand-woven checkered and printed Kota sarees. Kota being one of the coaching hubs for Engineering and Medical courses sees a huge number of Millennial population. As a result, the organised market also sees a good turnout in comparison to the traditional market.
Udaipur: Udaipur is one of the most popular travel destinations. Due to the presence of historical forts and lakes, the city witnesses a huge crowd of foreigners throughout the year. Being one of the most popular locations of ‘destination wedding’ the city market offers a huge range of retail for all classes of buyers. Udaipur retail comprises accessories, footwear (leather), jewellery, silk, handicrafts and fabric.
Despite the dominance of traditional and regional brands, Rajasthan is a home to big retail players as well.
Reliance: Reliance is one of the biggest players in Rajasthan retail industry. In the last five years, the state has witnessed the launch and opening of more than 50 Reliance Fresh stores and Reliance Mart in different urban and rural regions.
AV Birla Group: The brand is the other popular face in the state. It has a strong presence in Indian apparel retailing. The brands like Louis Phillipe, Allen Solly, Van Heusen, Peter England are quite popular. It’s also investing in other segments of retail. One can find branded stores in different high streets in cities like Jaipur, Udaipur, Kota and Bikaner.
Future Group: Future Group is one of India’s leading business houses with multiple businesses spanning across the consumption space. The brands like Big Bazaar, Future Bazaar, and Pantaloon are very popular in Rajasthan. After the impending acquisition of Future Group by Reliance Retail, Reliance will add more stores to its dominance. Apart from this, the shopping malls in the state have the presence of most international brands. The upcoming malls are also very keen in bringing more foreign players into this part of the region.
Shopping Malls in Rajasthan
Malls in Rajasthan are the new entertainment and prime attractions of the region, apart from the historical forts and palaces. As shopping malls are a much more organised retail format than the high streets and local markets, people especially youth and office going crowd are huge fans of the mall culture. Besides, shopping malls are also the entry point for most foreign brands which is becoming a trend in the tier II & III cities. Also, the fancy restaurants, food court, cinema and gaming zone are rated as one of the biggest platforms to attract crowds, especially families in huge numbers. Malls are also one of the preferred locations visited by tourists and foreigners. Jaipur has the maximum number of shopping malls in Rajasthan.
|Popular Regional Brands
||Popular High Streets
“As per ANAROCK Research, there are as many as 18 operational malls across various cities in Rajasthan presently while another two are under planning stage. Of the 18 operational malls in the state, at least 9 are in Jaipur, 3 in Udaipur and 2 each in Ajmer, Kota and Jodhpur. The cities with the two upcoming new malls are Udaipur and Kota and will be spread over a total 4.1 lakh sq. ft. area combined,” says Anuj Kejriwal, CEO & MD – ANAROCK Retail.
Uddhav Poddar, MD & Group CEO, Urban Square states that malls are changing the retail landscape of Rajasthan in not just one city but the nearby towns as well. “Let’s start with an example of Urban Square in Udaipur. Urban Square is a retail focused mix use project with hospitality and entertainment. It is a 2 mn sq ft development. Phase 1 is approximately 1 mn sq ft, which has 9 large anchor brands and a mix of vanilla brands. Malls such as Urban Square are changing the retail landscape of not just a particular city but of nearby towns as well (within a vicinity of 100 kms). They cater not just to the local city population but attract traffic from nearby towns as well, and they will be what you call Regional Shopping Centres. Such centres did not exist in Rajasthan earlier.”