IKEA India plans to quadruple revenue by 2030 through a new hub-and-spoke store strategy. The retailer reported a revenue of ₹1,749 crore in FY25, with losses reaching ₹1,325 crore. Investors in the retail sector may track whether this smaller store format helps the company lower high operational costs and improve profitability in a competitive market.
IKEA India has unveiled an aggressive roadmap to increase its revenue four times by 2030. To reach this goal, the Swedish retailer is changing its expansion strategy. The company is moving away from its primary reliance on massive, big-box stores in suburban areas. Instead, it is adopting a hub-and-spoke model that combines these large sites with smaller, agile stores located within dense city centers.
This shift is a response to the practical challenges of operating in India. Large suburban stores require significant land and investment, which can lead to high fixed costs. By opening smaller, city-center outlets—such as the recent 80,000-square-foot location in South Bengaluru—the company aims to make its brand more accessible and convenient for urban shoppers. This move is designed to reduce the time and distance customers travel to shop, which is often a barrier in busy Indian cities.
The company’s latest financial report highlights the scale of the challenge it faces while scaling its operations. For the 2024-25 fiscal year, IKEA India reported an operating revenue of ₹1,749 crore, representing a 3.3% contraction from the previous year. Losses widened to ₹1,325 crore, compared with ₹1,299 crore in the prior period. These figures illustrate that despite the brand's global presence, building a sustainable and profitable business in India requires deep and sustained capital spending.
Management has committed to investing over ₹21,000 crore by 2030 to support this expansion. A significant portion of this growth strategy focuses on online sales and business-to-business services, which currently contribute roughly 30% of total revenue. By targeting these areas, the company is attempting to diversify beyond footfall-dependent physical retail.
The Indian home furnishing market remains highly competitive. It is largely dominated by unorganized local players, alongside established organized competitors like Godrej Interio, Home Centre, and online-first platforms like Pepperfry. IKEA is attempting to maintain a price advantage by keeping its kitchen and core furniture ranges 25-30% cheaper than local alternatives. The firm has stated it has not increased prices despite global supply chain pressures, betting that affordability will help it capture a larger share of the Indian market where consumers are highly price-sensitive.
For those monitoring the retail sector, the success of this plan will depend on several factors. Investors and market analysts will watch whether the new smaller stores can successfully drive higher sales volume without significantly increasing overhead costs. The ability to manage logistics, maintain product availability, and adapt designs to suit compact Indian homes will be critical. The company's next phase of growth will likely be tested by its ability to balance high capital spending with the need to eventually reduce losses and achieve profitability in a diverse, price-conscious economy.