Retail Growth Hits 8% in July, Festive Season Could Push It Beyond 10%: RAI CEO

India’s retail sector is poised for a strong festive season, with sales growth likely to surpass 10% in the coming months, up from an already robust 8% rise in July, according to the Retailers Association of India (RAI).

RAI CEO Kumar Rajagopalan told a national news channel that the industry is witnessing renewed momentum after a prolonged period of muted demand, particularly in the value and mid-market segments. “Retail growth has touched 8%, and we expect it to go beyond 10% as early festive celebrations begin across the country,” he said.

The July figures mark the third consecutive month of improved performance, signaling broad-based recovery across categories. Premium segments remain resilient, while budget-conscious consumers are returning to value-driven purchases, Rajagopalan noted.

However, recent changes in Goods and Services Tax (GST) rates are expected to influence consumer behavior during the festive surge. Items priced under ₹2,500 — especially garments and footwear — have become more affordable, but higher-value products are now subject to an 18% GST, potentially curbing discretionary spending.

Jewellery Trends Shift Amid Price Pressures

Jewellery demand is also evolving. Elevated bullion prices have led consumers to shift away from heavy gold and silver purchases in favor of lighter, design-focused and diamond-studded pieces. While wedding-related purchases are expected to sustain premium demand, many buyers in the mid-tier segment are opting for lower caratage (18–20 carat) and smaller-ticket items.

Mixed Signals in Consumer Durables

The consumer durables segment presents a varied picture. Televisions and large appliances are seeing some traction thanks to price corrections, but mobile phones remain costly as GST rates on handsets remain unchanged. Beauty products could see a minor uptick, though salons are unlikely to pass on the full GST benefit to customers. White goods, meanwhile, continue to show selective demand, with performance varying across product categories.

Offline Retail Remains Resilient Amid E-commerce Boom

Despite the continued rise of e-commerce and rapid delivery services, offline retail remains firmly entrenched. “Large retailers have adapted to an omni-channel model, and interestingly, many online-first brands are now launching physical stores,” Rajagopalan said.

However, the transition is proving challenging for traditional kirana stores, which remain the most vulnerable segment in the evolving retail landscape.

As the festive season gains momentum, all eyes are on whether consumer sentiment — buoyed by discounts, promotions, and early celebrations — can carry retail growth into double digits.