According to a report by Wright Research, retailers are looking for 10-12% growth in the sales during festive season this year leading to an increase in employment by 20%
- IBEF
- October 12, 2023
Retailers estimate at least a 10-12% increase in sales above last year's levels this holiday season, says Wright Research, which predicts that consumer sentiment will improve. The analysis predicts that this holiday season, the automotive, FMCG, e-commerce, manufacturing, commodities, and travel & hospitality sectors will lead the rise. Additionally, a 20% boost in employment was predicted for the holiday season.
The beginning of the season, which begins with Ganesh Chaturthi and continues through Navratri, Diwali, and beyond, acts as a significant economic stimulant for the nation. According to the survey, auspicious buying, marketing, discounts, and postponed purchases are a combination of holiday exhilaration and alluring deals that stimulate consumer spending throughout the festival months. Additionally, it stated that e-commerce businesses predict a 28% increase in revenue during the holiday season.
According to the report, in addition to a holiday quarter, strong business adaptation to market changes and pertinent government intervention to control inflation point to the possibility of growth and employment opportunities well into the future.
Mrs. Sonam Srivastava, Small Case Manager and Founder of Wright Research, says the small case is making a tilt towards the festive stocks as the momentum picks up. The Innovation and New India portfolios bet on India’s economic revival with a focus on domestic manufacturing, automobiles, and e-commerce sectors, and the Momentum and Alpha small cases are bound to pick up the trending festive stocks as the momentum builds. Festivals are a Mahurat for good fortune in the Indian stock markets, and our portfolios are geared up to take advantage.
The holiday season serves as a "harbinger of the economic boom in the country," boosting India's GDP during the quarter and accounting for up to 40% of the annual sales of some businesses in industries like home furnishings, clothing, electronics, confectionery products, etc.
The Naukri JobSpeak Index reached 3,103 last year and experienced a 13% year-on-year (Y-o-Y) gain, confirming the relationship between employment and festival-driven spending. The tendency is not just present in big cities. The hiring rate increased by 27% YoY in metro areas like Mumbai last year, and it increased by the same percentage in growing cities like Coimbatore and Ahmedabad. Surveys from a variety of sectors, including Fast Moving Consumer Goods (FMCG), retail, travel and hospitality, and insurance, indicate that employment is expected to rise by 20% in the upcoming few months.
The report from Wright Research mentioned that there has been a 245% year-over-year growth in hiring for the manufacturing and industrial segments. The Banking, financial services, and insurance (BFSI) and telecommunication sectors also saw an increase in hiring. There’s a notable 9% increase in demand for retail staff thus indicating a broadening in the types of roles suited for gig workers, extending beyond just e-commerce. With the workforce in the e-commerce sector estimated to reach up to 3 lakh people across warehouse and delivery, it’s an indicator of a boom in online shopping and logistics.
Mrs. Sonam Srivastava further added that festivals play a pivotal role in stimulating economic activities which reflects deeply in India’s GDP growth.
Sales of consumer electronics and FMCG saw a surge of 25-30% Y-o-Y during 2023 Independence Day sales. Demand for FMCG, especially sweets, electronics and luxury items, soar around festival season. Manufacturing PMI for August climbed to a three-month high of 58.6, marking its 26th consecutive month above the pivotal 50-point mark, which distinguishes expansion from contraction.
Over the next two to three months, demand for gold is anticipated to soar as a result of the festive season. Industry analysts are bullish about gold's demand despite stalled gold prices brought on by US economic difficulties, attributing it to robust stock market performance and shifting consumer behaviour.
The demand for festival travel has increased by more than 100%, according to the travel industry. Due to improved infrastructure and rising airfares, interest in train travel has surged. The tourism sector is upbeat as demand for both leisure and urban locations is up by double digits over the previous year.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
Partners
