India’s Apparel Retail Market Set to Hit ₹16 Lakh Crore by FY30: CareEdge
Rising disposable incomes, digital adoption, and organized retail expansion set to fuel growth in India’s fashion sector
New Delhi, Jan 17: India’s apparel retail market is poised for robust growth over the next five years, with its size projected to reach nearly ₹16 lakh crore by 2029-30, according to a CareEdge Ratings report. The growth is being propelled by rising disposable incomes, rapid digitalisation, and strong demand for value fashion and e-commerce.
The market, estimated at ₹9.3 lakh crore in 2024-25, has expanded at a compound annual growth rate (CAGR) of around 7% since 2017-18. Organised retail currently represents roughly 41% of total apparel sales and is expected to grow faster, at 10-13% CAGR, supported by consumer preference for branded apparel, the entry of international brands, and expansion of structured retail formats.
A key growth driver is the value fashion segment, which benefits from rising brand awareness and price-sensitive consumers. Valued at ₹3.5 lakh crore in 2023-24, this segment is projected to grow at a CAGR of 7% to reach ₹5 lakh crore by FY30. Retailers like Zudio, Max Fashion, and Reliance’s Yousta are aggressively expanding in Tier-2 and Tier-3 cities, emerging as major consumption hubs.
E-commerce is also playing a critical role in the sector’s expansion. Online channels currently account for about 22% of organised apparel retail, with projections indicating a rise to nearly 25% by 2029-30, translating into a market size of around ₹5 lakh crore. Growing internet penetration, smartphone adoption, and Gen-Z’s influence on fashion trends are accelerating the shift toward digital-first and omnichannel retail strategies.
Despite demand pressures in 2024-25 due to inflation and adverse weather, the market showed signs of recovery during the festive and wedding seasons, driven by higher footfalls, online sales promotions, and improved consumer sentiment.
CareEdge Ratings also noted that recent GST changes are likely to benefit the value segment, with apparel priced below ₹2,500 attracting a lower tax rate of 5%, further boosting affordability and volumes.
