Consumer spending during the Navratri-Dussehra period shows a split trend. Sales of apparel and home appliances grew over 20%, supported by easy financing, while electronics faced a volume drop due to rising component costs. Auto retail growth remained modest at 2%, reflecting a high base comparison from last year.
The Indian retail market experienced a clear divide during the recent festive season, with demand for physical goods outperforming technology products. Data indicates that categories such as apparel, footwear, and consumer durables saw a robust increase, with industry-wide sales growing by more than 20% compared to the previous year. This positive momentum was supported by the availability of easy monthly installment schemes, which helped consumers manage spending despite higher costs. Additionally, there has been a noticeable shift in consumer preferences, with many shoppers prioritizing the accumulation of physical assets over spending on travel or hospitality services.
Appliance Demand and Consumer Behavior
Home appliance manufacturers, including LG Electronics, Godrej Appliances, and Haier India, reported growth averaging between 18% and 20%. Demand for cooling products remained particularly strong in western and southern markets, where temperatures drove unit sales. Retailers like Vijay Sales noted that air conditioner demand spiked by over 50%. This surge suggests that for many households, appliances are viewed as essential upgrades, and retailers have successfully used financing options to maintain this demand.
Tech Sector Struggles with Price Hikes
In contrast, the technology hardware sector faced sustained volume pressure. Sales of smartphones, laptops, and televisions contracted by 16% to 20% across both online and physical stores. The primary driver for this decline is the rising cost of memory components, which have become 15% to 40% more expensive. These price increases have pushed many products out of the reach of entry-level and mid-range buyers. Consequently, only the premium segment of the tech market has shown resilience, while the broader sector has struggled to attract volume despite the festive environment. Distributors have reported limited growth, highlighting that rising costs are now directly impacting consumer purchase decisions.
Automotive Sector Normalization
Automobile retail sales recorded a modest 2% growth between October 11 and 19, with approximately 1.03 million units sold. While this figure represents an improvement over the previous year, observers note that the growth rate appears lower due to a high comparison base from the prior cycle, which was impacted by regulatory changes. Manufacturers like Hero MotoCorp noted that demand for two-wheelers and scooters remained healthy, suggesting that interest in individual mobility persists. However, the overall auto market remains sensitive to macroeconomic shifts and inventory levels.
Moving forward, investors and industry watchers will track whether the current trends in appliance and apparel spending can sustain their momentum post-festive season. For the technology sector, the key monitorable will be the trajectory of memory chip costs and whether retailers can stabilize pricing to recover volume. Additionally, the sustainability of consumer credit and the impact of the high comparison base on future auto sales will remain important factors for sector performance.