Super, hypermarts to corner majority of investments, says study

Super, hypermarts to corner majority of investments, says study

New Delhi, 4 September The booming Indian retail sector, which is expected to reach a size of $1,011 billion by 2017, will see supermarkets and hypermarkets cornering as much as 66% of the total investments, a study by marketing consultancy firm Technopak has said.

According to the study, in the next three to five years there could be increased rate of shakeout with only four categories of ‘survivors´ emerging in the next 3-5 years.

Predicting a clear tilt in favour of large formats on the investment front, the study said majority of investment in the next 6-7 years is slated for hypermarket and supermarkets with 32% and 34% share respectively.

While warehouse, cash and carry will have 9% share, departmental stores -- 2% and other formats which include apparel, footwear, watches, furniture, furnishing, toys will have 23% share in the total market, it added.

According to Technopak estimates, maximum action in the Indian retail space is going to be in top 50-60 urban markets.

“In these markets there shall be rapid margin erosion for those competing in mainstream formats like supermarkets and hypermarkets, which may lead to pressure on the supplying brands as well," the study said.

Predicting a rapid transformation in the next five years, it said the share of organised sector in total retail will go up from the present 4% to 16% in 2012 and to 28% by 2017.

Forecasting consolidation, the study said in next five years top seven players will have 31% of the market share in top 150 cities, while share of next 43 players will be just about 8%.