Food Retail

Food and grocery is the largest segment in the Indian retail sector, accounting for 65% of the share in retail. The market is expected to grow at a CAGR of 10%, driven by the increasing consumption of processed foods, and benefiting from rising diary consumption and premiumization trends.

Owing to the uncertainties of the pandemic, there has been a transformation of the grocery landscape due to factors such as:

1. Digital adoption: With close to 955 Mn Indians connecting on the Internet and number of digital transactions being 185.9 Bn in 2023-24, the country has seen one of the fastest accelerations in digital adoption anywhere in the world
2. Innovation: Rapid digitization has made way for new start-ups, which have built or adapted their operating models to the Indian context
3. Direct-to-consumer (D2C): A market-shifting force that is transforming the way Indians shop

Although conventional categories like Staples and Fresh put together account for ~80% of the total food retail spend, but emerging categories of packaged snacks, confectionery, and beverages are growing rapidly at a compounded rate of 15%. Increasing awareness around health and wellness is set to increasingly shape consumer preferences across categories. 

Online grocery

With the onset of the Indian e-Commerce revolution, online groceries have been gaining prominence. The Indian e-grocery market has seen a CAGR of over 50%, estimated to be $2 Bn to $3 Bn in 2020, and projected to grow to $10 Bn to $12 Bn by 2025.

Within the e-Commerce sector, there is a growing significance of quick commerce, that contributes of 13% of the overall online Food and Beverage sales.