Trends: Consumer Confidence In India still down

While the stock market is up and the core economy numbers are good the fact remains that consumer confidence in India is still down. CNBC T...

While the stock market is up and the core economy numbers are good the fact remains that consumer confidence in India is still down. CNBC TV18 and Boston Analytics India Consumer confidence index numbers for September are the lowest in 20 months that they have been tracking this data but the fall of 1% is the lowest in months and they see this data as a pointer that consumer confidence has reached its lowest point.
  1. The trends indicate that consumers are spending more on necessities than lifestyle. There is definitely an upswing, but there is no euphoria.
  2. Rough estimates by retailers suggest spending on food items is growing 15-20% faster than that on non-food products.
  3. Now the reason for this seems to be soaring food prices and fresh memories of job losses early this year which seems to have dented consumer confidence.
  4. Overall growth rates in modern retail have dropped from a heady 35-40% in the past few years to around 10-15% currently, according to industry estimates.
  5. Most of the growth is coming into the value formats in a challenging consumer environment.
Everyone is now banking on festive seasons by bundling various offers to drive Indian consumers to spend again but recession has definitely left its mark on psyche of India and the highs of previous years will take some time to regain.


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Anonymous said...

Consumer confidence still might not be upto the mark as one would expect, but one cant deny the fact that India is on upswing. Lots of new things are happening like for the first time in India, PMI is hosting a three day conference on Project management where distinguished speakers from all over the world are invited. Know more at PMI conference website.

Nagesh.MVS said...

Maybe it is Not true ?
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VJ1681 said...

I believe that the consumer confidance is actually imporved over the recent months.
Being in the Credit Cards Acquiring Business, we have seen pretty nice growth trends post July. This means that an average cardholder is actually using his credit card more month on month.
Subsequently the Retail Sector has actually grown at an average rate of 18.5%.
Where is the consumer slow down....?

Abhishek said...

Again what they seem to be saying is that spending on food items is increasing due to inflation while that on discretionary expenses is decreasing and that is because of lower consumer confidence but then this is a debatable issue

VJ1681 said...

I have a strong feeling that it is more of a database issue.
If we consider discretionary spending to be associated with sale of Electronic Equipment (excluding mobile phones), or Airline Travel or Hotel/Restaurant spends. we have found that all these sectors have actually increased in terms of business generated. Being the second largest card acquirer in India, I am quiet confident about the same.