3%- this is the estimated share of organized sector in total Indian retail market. But next 3-4 years would see almost double retail outlets and retail space, owing to the emulous expansion plans.
World retail market says that India has bright possibilities in retail sector and considers it as the pioneer destination for investment; saturation of western markets may be a reason for this. Thus, the bigwigs of western retail markets are turning to India to tap the opportunity. Indian retail industry accounts for about 10% of GDP and around 7% of the employment and would become $ 16 billion market by 2010. Around 1500 supermarkets, 325 departmental stores and 300 new malls are coming up in the cities very soon.
Indians are enjoying shopping like never before, thanks to increasing salaries, low interest rates and inception of new malls that have made shopping a great fun for the swelling Indian middle-class. But investors' exuberance for the sector has kept the share prices of India's few listed retailers at levels that are higher than the potential earnings needed.
Another reason for over enthusiasm in retail sector is the belief that India would start retailing to FDI. The global retailers have shown their interest in India. Hence, government is planning to facilitate restrictions. Some investors are gambling on retail sector today in a hope that when the foreign investment will be given green signal, these will become the targets for takeover.
Presently, the bar on FDI in retail by Indian government is in place, apparently to allow the domestic retailers to 'grow up' without any competition fear. Looking at the estimated size of industry by 2010, there is plenty to operate- means that they have to make the right decisions on location, format, product offerings, marketing strategy and other important issues. This is the government's plan for Indian retail sector for coming years.
For further information about Indian Retail Sector and its future growth prospects, read the report "India Retail Sector Analysis (2006-2007)" by RNCOS at:
http://www.rncos.com/Report/IM058.htm
RNCOS is an industry leader in the field of online business research. We specialize in industry research on various business verticals. To read our other reports, visit: http://www.rncos.com/Report.htm or email us at info@rncos.com.
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