Mumbai Capital

Mumbai region has most potential for retail

he Mumbai Metropolitan Region (MMR) has the highest potential for modern retail in the country, at Rs 1,05,000 crore by 2036, followed by the National Capital Region (NCR) and Bengaluru, according to a report by property consultancy Knight Frank and Retailers Association of India (RAI).

The report also said India is the most important market for global retailers with Mumbai, Bengaluru and NCR region at the crest of the retail wave. The majority of global retailers planning to enter the country are considering these three locations in the first phase. Nearly 400 international brands are already present in India, and some of the recent entrants include Ikea, H&M, Gap, Aeropostale and Massimo Dutti.

The total retail spending in the top seven retail markets in India amounts to $62 billion, and is expected to touch $132 billion by 2020. The report also said the penetration of modern retail will increase to 24 per cent from 19 per cent in the next five years in the top seven retail markets in India.

With an estimated population of 2.2 crore in 2015, MMR is one of the biggest urban agglomerations in India, the report said. Nearly 57 per cent of the city’s population comprises households earning above Rs 3 lakh per annum. MMR has the second biggest customer base for retail across all seven urban centres.

It also said MMR leads in terms of total retail expenditure of Rs 1,21,400 crore, contributing nearly 29 per cent of the total retail expenditure in the top seven urban centres of the country.

However, MMR lags behind NCR in terms of modern retail penetration, while its per capita modern retail spending is far below that of Bengaluru and NCR, said the report.

The report pointed out that the low penetration in MMR is primarily due to the haphazard and unorganised retail markets across the city. “Some of the biggest shopping areas in MMR, such as Crawford Market, Zaveri Bazaar, Hindmata market, Lamington Road, Kalamboli market and Linking Road are still non-modern, unlike NCR and Bengaluru where shopping streets are transforming into modern retail destinations.” The market size for modern retail is expected to grow at a compounded annual growth rate of 23 per cent to Rs 38,100 crore in 2019 from Rs 16,400 crore in 2015 in MMR.

The potential for food and beverage quick service restaurants (QSR) in the Andheri-Borivali belt and the island city is estimated to be Rs 780 crore and Rs 730 crore respectively by 2036, offering a big opportunity to QSR players such as McDonald’s, KFC, Burger King and Domino’s Pizza, the report said.

“Even though the pace of modernisation of retail formats in the country is slow, Bengaluru and NCR are likely to experience 50 per cent modern retail penetration by 2026 and 2028 respectively. The modern retail segment in NCR, MMR and Bengaluru has a potential of more than Rs 1,30,000 crore in the daily needs hypermarkets/supermarkets category. Apparel and F&B together have a potential of more than Rs 30,000 crore. In order to support the potential of these two categories (apparel and F&B), the three cities together would require approximately 20 m sq ft of modern retail space,” Samantak Das, chief economist and director of research, Knight Frank India, said.

Retail spending in

the top seven retail markets in India is expected to touch $132 billion by 2020

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Printable version | Apr 14, 2021 6:31:08 PM |

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