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India's Apparel Market to Hit Rs 16 Lakh Crore by 2030, Fueled by Value Fashion

India's apparel retail market is projected to expand significantly, reaching nearly Rs 16 lakh crore by the 2029-30 financial year from an estimated Rs 9.30 lakh crore in 2024-25. This growth is primarily driven by the booming value fashion segment and the rapid expansion of e-commerce, with online channels expected to capture a quarter of the organised retail market. Aggressive store network expansion by retailers in Tier-2 and Tier-3 cities is turning these areas into major consumption hubs. While inflation posed challenges, recovery signs emerged during festive seasons, supported by favorable GST changes for affordable apparel.

Key Points: India Apparel Retail to Reach Rs 16 Lakh Crore by FY30

  • Market to grow from Rs 9.3L Cr to Rs 16L Cr by FY30
  • Value fashion segment is a key growth driver
  • E-commerce share in organised retail to hit 25%
  • Organised retail growing faster at 10-13% CAGR
2 min read

India's apparel retail market poised to reach Rs 16 lakh crore by FY30: CareEdge

India's apparel retail market is projected to grow to nearly Rs 16 lakh crore by FY30, driven by value fashion, e-commerce, and rising incomes.

"Online channels... are projected to increase their share to nearly 25 per cent by 2029-30 - CareEdge Ratings report"

New Delhi, January 17

India's apparel retail market is set for a significant expansion over the next five years, with industry size projected to touch nearly Rs 16 lakh crore by 2029-30, driven by rising disposable incomes, rapid digitalisation and strong growth in value fashion and e-commerce, according to a CareEdge Ratings report.

The apparel market, estimated at Rs 9.30 lakh crore in 2024-25, has grown at a compound annual growth rate (CAGR) of around 7 per cent since 2017-18.

Organised retail currently accounts for approximately 41 per cent of the total market and is expected to grow at a faster pace of 10-13%, supported by increasing consumer preference for branded apparel, the entry of international brands and the expansion of structured retail formats.

A key driver of growth is the value fashion segment, which is benefiting from rising brand awareness and consumer price sensitivity.

Value fashion, estimated at Rs 3.5 lakh crore in 2023-24, is expected to grow at a CAGR of 7 per cent to reach Rs 5.0 lakh crore by 2029-30.

Retailers such as Zudio, Max Fashion and Reliance's Yousta are aggressively expanding their store networks, particularly in Tier-2 and Tier-3 cities, which are emerging as major consumption hubs, it said.

E-commerce is another major growth engine for the sector.

Online channels currently account for about 22 per cent of organised apparel retail and are projected to increase their share to nearly 25 per cent by 2029-30, translating into a market size of around Rs 5.0 lakh crore.

Rising internet penetration, increasing adoption of smartphones and the influence of Gen-Z consumers on fashion trends are accelerating the shift towards digital-first and omnichannel retail strategies.

While the industry faced demand pressures in 2024-25 due to inflation and adverse weather conditions, signs of recovery emerged during the festive and wedding season towards the end of the year.

Increased footfalls, promotional online sales events and improved consumer sentiment have supported the rebound in sales momentum.

CareEdge Ratings noted that recent GST changes are likely to favour the value segment, with apparel priced below Rs 2,500 attracting a lower tax rate of 5 per cent, boosting affordability and volumes.

In contrast, higher GST on premium apparel may encourage consumers to trade down, further strengthening demand for value offerings, it said.

- ANI

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Reader Comments

A
Aman W
While the growth numbers are impressive, I hope this expansion is sustainable. The article mentions adverse weather conditions impacting demand. With climate change, unseasonal rains can ruin seasonal inventory for small retailers too. Growth plans must factor in environmental risks.
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Rohit P
The GST change is a masterstroke! Lower tax on clothes under ₹2500 will directly benefit the common man. My family's entire wardrobe refresh happens in that range. This will definitely boost volumes for the value segment. More money in our pockets!
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Sarah B
Living in a Tier-2 city, the change is visible. Five years ago, we had limited options. Now, with brands like Yousta opening here, the shopping experience has completely transformed. The malls are buzzing! It's great for local employment as well.
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Karthik V
E-commerce reaching nearly 25% share is huge! As a Gen-Z, most of my clothes are from Myntra or during online sales. The convenience, variety, and easy returns are unbeatable. Traditional retailers need to up their digital game fast to survive.
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Nisha Z
I appreciate the focus on value fashion, but I hope quality doesn't take a backseat. Fast fashion can lead to a lot of waste. I wish the report also highlighted efforts towards sustainable and durable clothing. Growth should be responsible.
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