India’s retail sector is expected to report moderate growth in the third quarter of the current financial year, supported by heightened consumer spending during the festival and wedding seasons, according to market analysts. Retail companies are projected to deliver around 12% year-on-year revenue growth for the quarter.
Analysts at Elara Capital noted that consumption associated with weddings and festivals is likely to underpin sequential improvements in sales volumes, although demand remains selective. They observed that value-led categories are outperforming while recovery in premium segments continues at a measured pace, with sharper product assortments and new launches contributing to increased footfall and stronger conversion rates at higher price points. However, these factors may be offset by elevated discounting and promotional activity, which could compress margins.
Apparel retailer Trent reported a 17% rise in revenue, accompanied by significant store expansion. Elara Capital attributed improved demand for wedding wear and occasion-led purchases to the extended wedding season, while noting modest growth in luggage sales driven by seasonality and product differentiation.
In contrast, some discretionary categories are expected to remain subdued. A preview from Nuvama Institutional Equities suggested that value retail formats and certain segments such as footwear may underperform, although select operators have posted modest like-for-like sales growth.
Overall, the outlook for the retail sector in the December quarter points to resilient consumer demand concentrated in festival-related and wedding-driven categories, even as broader discretionary spending remains cautious.
