Jean-Christophe Babin, the CEO of Bulgari, an Italian luxury jewellery brand, picks up the B.zero1 Kada bracelet, priced at approximately INR 12 lakh, from a collection of iconic pieces at the brand’s Mumbai store in Jio World Plaza. “We are likely the only global jeweler offering Indian items like the mangalsutra and the kada,” he remarks. “The mangalsutra sold out very quickly, and we had to produce more,” he adds. Bulgari’s mangalsutra is priced over INR 4 lakh, yet it consistently sells out in stores.
Bulgari’s jewellery and watches have been enthusiastically embraced by Indians. “We achieved our highest-ever sales performance in India in 2023,” says Babin. According to the consulting firm Bain & Co, the luxury goods market in India, which encompasses personal luxury items, jewellery, home décor, cars, boats, and spirits, is currently valued at $17 billion and is projected to reach $90 billion by 2030.
Within the $17 billion market, the segment of personal luxury goods, encompassing watches, leather, apparel, and beauty products, accounts for $4 billion. In contrast, the global luxury market is colossal, reaching €1.5 trillion ($1.6 trillion). The ranks of affluent Indians are swelling, and their appetite for luxury is insatiable. The count of high net worth individuals (HNIs), possessing assets worth at least $1 million, stood at 790,000 in 2022 and is anticipated to surge to 1.65 million by 2027. According to Bain, the number of ultra-high net worth individuals (UHNIs), with assets valued at a minimum of $30 million, was approximately 12,000 in 2022 and could exceed 19,000 by 2027.
Meanwhile, Mumbai has surpassed Beijing as Asia’s billionaire hub for the first time, boasting 93 members in this exclusive club, according to the Hurun Global Rich List 2024. This trend is clearly reflected in the sales figures across various luxury categories. Luxury car sales in India reached a record high of 42,731 units in CY2023, marking a 20% year-on-year increase, as reported by Jato Dynamics. This growth can be attributed to rising disposable incomes and a tendency among consumers to upgrade their purchases following the Covid-19 pandemic. The upward trend is expected to persist in 2024, propelled by new product launches and increasing consumer aspirations.
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In 2023, super-luxury car sales, priced above INR 2 crore, reached record numbers, albeit from a smaller base. Lamborghini, with models starting at INR 3.8 crore in India, sold 103 units last year compared to 92 units in 2022. Additionally, luxury sports car manufacturer Porsche reported its highest retail sales in India, selling 914 units in 2023, a 17% increase from the previous year.
Luxury housing priced at INR 50 crore and above has seen remarkable growth.
According to data from JLL India, luxury homes valued at INR 4,319 crore were sold in CY2023, up from INR 2,859 crore in 2022. This increase in sales value was coupled with a rise in the number of transactions, with 45 luxury homes sold in 2023 compared to 29 the previous year.
“There has been a notable evolution in India’s luxury market, driven by a rise in HNIs and UHNIs. Interestingly, there’s a shift as consumers, who previously looked for luxury overseas, are now focusing on India,” remarks Anurag Mathur, a partner at Bain & Co. “As international brands broaden their presence, domestic luxury brands are also on the rise. This dynamic environment indicates a promising path for growth,” he adds.
Experts suggest that social media has served an important role in the growing popularity of brands, particularly in the textile and fashion industries. Mathur says, “Social media has significantly increased the visibility of brand messages. Collaborations with celebrities have made brands more accessible to a wider audience.”
Gopal Asthana, CEO of Tata CLiQ, sees the rise of the luxury sector as a long-term trend. “Online shopping is important for luxury brands, given the spread of wealth across the nation,” Asthana said. He says that Tata CLiQ Luxury, with its nationwide presence & consumer-friendly regulations, has aided and promoted the shift to online luxury purchasing. Last year, Tata CLiQ Luxury’s top-performing categories were clothes, footwear, and watches.
As wealth increases, people’s tastes and preferences evolve, especially among the younger generation, according to many companies. Neeraj Walia, MD and CEO of Montblanc India, points out that despite the ubiquity of gadgets, there is a growing culture of writing and journaling in the luxury segment. “A significant number of young individuals are financially successful and are becoming consumers of luxury goods. The younger generation looks for products with personal significance and compelling stories. Our limited-edition collections, such as Writers Edition and Masters of Art, appeal strongly to this demographic,” he adds.
In addition to India-centric innovations by brands and the inauguration of the luxury mall, Jio World Plaza, in Mumbai, one standout event on the calendar was Dior’s fashion show. The renowned fashion house incorporated India into its seasonal lineup, transforming the marigold-adorned Gateway of India into a runway for its pre-fall 2023 collection.
Designer Sabyasachi Mukherjee also considers 2023 as “highly significant” for him, marked by the opening of his largest flagship store in Mumbai and the introduction of his jewelry boutique at Taj Krishna in Hyderabad. His global partnerships include a limited-edition lipstick collection with Estee Lauder and the debut of eyewear with Morgenthal Frederics. He also highlights a concern: “The infrastructure and distribution channels needed for a luxury boom are still a challenge. However, once we overcome this hurdle, India is poised for significant growth.”
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To facilitate this transition, the Indo-French Chamber of Commerce & Industry (IFCCI) has established a committee featuring brands like Louis Vuitton, Dior, and Hermès. The aim is to help these brands grasp the opportunities in India and to foster collaboration with Indian craftsmanship, which is gaining international recognition. “India is a pivotal market and a priority for many foreign companies, particularly those in the luxury sector. Meanwhile, Indian designers such as Rahul Mishra and Gaurav Gupta frequently showcase their collections at Paris Fashion Week,” says Payal S Kanwar, Director General of IFCCI.
“There is a convergence of international brands exploring the Indian market and Indian craftsmanship gaining recognition abroad. Many new, small-scale luxury players are also considering entering the Indian market.”
A shortage of quality retail space poses a significant challenge for brands aiming to expand in India. Pushpa Bector, Senior Executive Director at DLF Retail, notes that despite this obstacle and occasional disruptions in the supply chain since 2020, the luxury retail industry experienced substantial growth in 2023, especially in segments like high-end fashion, accessories, and jewelry. Brands made a more “focused effort” last year to better connect with Indian consumers. “They implemented measures such as aligning pricing strategies with global standards and diversifying product offerings in local stores to cater to a variety of preferences,” she adds.
The opening of the Ram temple in Ayodhya also had a positive impact on the Spanish luxury porcelain brand Lladró. Nikhil Lamba, CEO of Lladró India, reveals that sales of its Ram Darbar collection, priced at INR 2.3 lakh for the open edition and INR 13.45 lakh for the limited-edition set, tripled in the first quarter of 2024 compared to the previous year. In August, the company will introduce a limited-edition sculpture of Lord Hanuman as part of its Spirit of India collection. Their limited-edition Lord Balaji, initially launched in 2018 with only 299 units, saw a 38% increase in price last year and now retails for INR 33 lakh each, with fewer than five unsold pieces worldwide.
The surge in Swiss watch exports to India further confirms the growing luxury market in the country. According to the Federation of the Swiss Watch Industry (FH), exports of Swiss watches to India reached 218.8 million Swiss francs ($240 million) in 2023, marking a 16% increase from 2022.
Pranav Saboo, CEO of Ethos Watch Boutiques, a luxury watch retailer, announced a 22.4% growth in operational revenue during an earnings call for Q3 FY2024. The sales increased from 229.7 crore to INR 281.2 crore year-over-year. “Our aim is to accomplish the yearly sales of 100,000 watches over the next ten years, with an average ex-factory price of CHF 2,500 per watch,” he said.
It’s not limited to watches alone. According to Riti Gupta, spokesperson for Läderach India, sales for the Swiss chocolate retailer Läderach have skyrocketed more than fivefold since its introduction in India last year. Gupta notes that global brands are increasingly entering the Indian market, acknowledging its luxury market potential and fueled by a growing affluent class seeking high-end experiences.
“This momentum is driving our expansion plans, and we anticipate announcing the opening of additional stores this year,” she remarks. Bector from DLF Retail indicates that the outlook for 2024 is optimistic, with positive expectations across the industry. “The growth is anticipated to be propelled by the increasing segment of affluent Indian consumers and a young demographic eager to adopt luxury products,” she adds.
“With brands anticipated to adjust their strategies and offerings to align with the changing preferences of the Indian market, the groundwork is laid for another year of strong growth and innovation in the luxury sector.”
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