New Delhi: Two of the world’s largest firms in the eyewear market—Italy’s Luxottica and France’s Essilor—on Monday agreed to a €46 billion merger. Both have a presence in India where the market was worth Rs22,674 crore in 2016, according to market researcher Euromonitor International. It is expected to grow to Rs34,131 crore by 2021.
At present, Essilor and Luxottica are the top two in terms of value market share in India. According to a September 2016 study by Euromonitor, Essilor had a 10.5% market share (value) in 2015, up from 8.2% in 2010. Luxottica had a 5.5% market share (value) in 2015 up from 4.6% in 2010, added the Euromonitor study. After the merger, Essilor-Luxottica’s combined market share will be 16% with Carl Zeiss a distant second. The firm had a 4.6% share of the eyewear market in India in 2015.
“There are some 75 million people who are above 60 years (in India). That’s a big market. On the other hand, kids are getting glasses sooner than earlier. Since the market is highly fragmented, brands such as Essilor and Luxottica will have a huge advantage,” said Rajat Wahi, partner and head (consumer markets), at consultancy KPMG in India.
As per the latest Census data, about 8.6% of India’s 1.2 billion population is above the age of 60.
Essilor and Luxottica representatives in India declined comment.
Globally, the merger will result in an entity with almost 40% share of the market, said Jasmine Seng, research analyst (personal accessories and eyewear), Euromonitor.
Essilor, which sells lenses under brands such as Varilux, Crizal, Definity, Xperio and Foster Grant, began operations in India through a joint venture with SRF back in 1998. In 2006, it bought out the stake of its local partner. The company has since grown through acquisitions. It has also picked up minority stakes in Surat-based Deepak Optic, Lens and Spects, Kolkata-based GKB Rx Lens Pvt. Ltd and Hyderabad-based 20 20 Rx Processing.
Luxottica started selling Ray Ban sunglasses in India through subsidiary Rayban Sun Optics India Ltd (once listed on BSE) since 1990.