What’s Driving India’s Retail Sector to a 169% Growth in Q1 2025?
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Synopsis
The Indian retail market has seen an incredible surge of 169% in Q1 2025. This growth is fueled by new retail openings and increased leasing activities in major cities. Discover how Bengaluru and Hyderabad lead the charge and what this means for the future of retail in India.
Key Takeaways
- 169% growth in the Indian retail sector in Q1 2025.
- 3.1 million square feet of retail space leased.
- Bengaluru and Hyderabad dominate leasing activity.
- Fashion and apparel lead the retail landscape.
- 86% of the retail space was taken up by domestic retailers.
Mumbai, May 9 (NationPress) The Indian retail sector has experienced a staggering 169 percent growth (year-on-year) in the January-March quarter, fueled by a robust wave of new retail store openings in prominent metropolitan areas, as highlighted in a report released on Friday.
On a quarter-over-quarter (QoQ) basis, gross leasing activities in the retail sector showed a positive trend, increasing by 9 percent, according to JLL India's report.
Demand for retail spaces has remained strong across the top seven cities, with the introduction of new retail spaces reaching an all-time high.
In Q1 2025, retailers leased 3.1 million square feet in shopping malls and high streets within the leading seven cities. Additionally, the supply side saw the addition of 2 million square feet of new retail space.
Geographically, Bengaluru and Hyderabad accounted for a significant 60 percent of total leasing activity across India. Vibrant leasing activity was reported in suburban micro-markets of both cities, driven by a demand for larger store sizes from retailers in categories such as daily essentials, groceries, food and beverages, and fashion and apparel, according to the report.
Among various retail segments, fashion and apparel emerged as the leader in India's retail sector.
“This segment commanded a notable 31 percent share of leasing activities in Q1 2025. Brands focused on contemporary and fast fashion dominated the market as both established and new players expanded their physical presence to meet the demands of the younger demographic,” stated Dr. Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.
During this quarter, local retailers dominated the retail space take-up, accounting for 86 percent of the activity.
Additionally, eight new international brands launched their first stores in the country.
“These included fast-fashion retailers, European coffee brands, and electric vehicle (EV) manufacturers. The burgeoning out-of-home coffee market in India is enticing new international brands that cater to artisanal brewing and the premium coffee segment,” mentioned Rahul Arora, Head-Office Leasing and Retail Services, India, JLL.
Point of View
It is imperative to recognize that the remarkable growth in India's retail sector reflects a positive shift in consumer sentiment and spending. This surge is a testament to the resilience and adaptability of Indian retailers, particularly in the face of evolving market demands.
NationPress
21/05/2025
Frequently Asked Questions
What is the growth percentage of India's retail sector in Q1 2025?
The Indian retail sector experienced a growth of 169% in Q1 2025 compared to the same period last year.
Which cities are leading in retail leasing activity?
Bengaluru and Hyderabad accounted for 60% of the overall retail leasing activity in India during Q1 2025.
What sectors are driving the growth in retail space?
The fashion and apparel sector has been a frontrunner, contributing to 31% of leasing activities in the first quarter of 2025.
How much retail space was leased in Q1 2025?
A total of 3.1 million square feet of retail space was leased across the top seven cities in India.
How many new international brands opened in India during the quarter?
Eight new international brands launched their first retail stores in India during Q1 2025.
