Global consumer giants have praised India’s market performance. Top brands like Coca-Cola, Harley-Davidson, and Philip Morris International have highlighted India as a key growth driver, especially when other markets are experiencing slower demand.
This enthusiasm isn’t limited to a single sector; discretionary and mass-market brands are optimistic about India’s potential and plan to make significant investments to fuel further expansion in 2025.
During their recent earnings calls, companies such as Philip Morris International and Yum! During their recent earnings calls, brands Carlsberg Group, Pernod Ricard, Apple, Beiersdorf, and Skechers highlighted India as a key growth market for the December quarter and fiscal year 2024.
Why India Stands Out in Global Consumption | |
Companies With More Investment This Year. | Coca-Cola, Carlsberg |
High Sales Growth in Oct-Dec 24 | Pernod Ricard, Skechers, Apple, AO Smith |
India Driving Asia-Pacific Business | Harley-Davidson, Philip Moris, Yum! Brands |
GDP Growth Forecast | Forecast at 6.7% in FY26 from 6.4% in FY25 |
Income Tax Relief | Revival in Household Consumption due to Income Tax Relief |
Economic Outlook: Growth Projections and Fiscal Measures
The Reserve Bank of India (RBI) has projected GDP growth of 6.7% for the 2025-26 fiscal year, indicating strong momentum ahead. For the current fiscal year (2024-25), India’s economy is expected to expand at 6.4%, reinforcing positive growth expectations.
The FY26 budget’s income tax rationalization is expected to stimulate household spending, boosting overall consumption and economic activity. The government is optimistic about the economic rebound and has assured that India’s growth slowdown is temporary. It has also emphasized that the economy is set for a “speedy rebound.”
Global Brands See Strong Growth in India
Coca-Cola’s Sweet Success
Coca-Cola has seen remarkable growth in India, with its mango drink, Maaza, becoming a billion-dollar brand. The company has emphasized India’s vibrancy and mentioned that a significant portion of its 2025 capital investment is earmarked for India and Africa.
Harley-Davidson’s Revved-Up Sales
Harley-Davidson’s full-year sales in the Asia-Pacific region declined by 18% year-on-year in 2024, primarily due to weak demand in Japan and China. However, sales in India, Australia, and New Zealand showed modest growth despite the regional downturn. economictimes.indiatimes.com
Tobacco and Spirits: A Growing Appetite
Philip Morris International, known for its Marlboro brand, identified India as a significant contributor to its growth in low and middle-income countries. The company reported a 0.6% growth in cigarette shipments in 2024. Growth was driven by markets where smoke-free products are prohibited, including Turkey, Brazil, and India. Excluding these markets, the company saw a low single-digit decline in overall shipments.
Carlsberg acknowledged India’s volatility but confirmed increased investments in 2025. Plans include expanding production capacity for the 2026 season and boosting sales investments.
Similarly, Pernod Ricard, the Chivas Regal and Absolut vodka maker, has been focusing on the Indian market, recognizing its potential amidst a global slowdown. The company stated that India is now the company’s second-largest market, and the liquor giant saw 6% growth between June and December 24.
Footwear and Fashion: Stepping Up
Skechers, an American footwear brand, reported a 25% increase in sales in India for the December quarter. The company plans to open more stores nationwide to capitalize on the growing demand for performance and lifestyle footwear.
Fast Food Giants Expanding
Yum! Brands, which operates KFC and Pizza Hut, has been expanding its footprint in India. The company sees India as a key market for growth, contributing significantly to its international sales.
High Growth in Key Sectors
Apple, Skechers, and AO Smith reported strong growth in the October-December quarter. Apple recorded its highest-ever quarterly sales, with the iPhone becoming the top-selling smartphone.
Factors Fueling the Growth
Several elements contribute to India’s appeal to these global giants:
- Rising Disposable Incomes: As more Indians move into the middle and upper-middle-income brackets, there’s an increased appetite for premium and discretionary products.
- Urbanization: The rapid growth of cities has led to more consumers with varied tastes eager to try new products and experiences.
- Youth Demographic: A significant portion of the population is young, so there’s a natural inclination toward global brands, fashion, and technology.
- Digital Penetration: The widespread use of smartphones and the internet has made it easier for consumers to access global brands, increasing awareness and demand.
Challenges on the Horizon
While the outlook is optimistic, companies must navigate certain challenges:
- Infrastructure Variability: Ensuring product availability across diverse geographies can be complex due to varying infrastructure quality.
- Regulatory Environment: Staying compliant with India’s evolving regulatory landscape requires continuous attention.
- Local Competition: Domestic brands are also upping their game, offering quality products at competitive prices, which means global brands must continually innovate to stay ahead.
Looking Ahead
The enthusiasm from global consumer companies underscores India’s growing importance in the worldwide market. With strategic investments and a keen understanding of local preferences, these companies are well-positioned to ride the wave of India’s consumption boom. As 2025 unfolds, seeing how these brands adapt and thrive in this dynamic landscape will be interesting.
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FAQs
Why are global giants flocking to India?
India’s 6.7% GDP growth forecast signals a thriving economy, attracting consumer giants seeking expansion and high sales potential.
What’s driving this growth?
Rising disposable incomes, a young population, and increasing urbanization fuel India’s consumer spending, making it a lucrative market.
Which sectors are seeing the most growth?
E-commerce, consumer durables, and retail are witnessing significant growth as Indian consumers embrace online shopping and modern lifestyles.
How is this impacting local businesses?
While global giants bring competition, they also create opportunities for local businesses to partner and expand their reach.
What does this mean for Indian consumers in the future?
Increased choices, better quality products, and competitive pricing are some benefits Indian consumers can expect as the market grows.