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Euromonitor International
May 2017
HOME FURNISHINGS IN INDIA Passport I
Euromonitor International
HOME FURNISHINGS IN INDIA Passport 1
TRENDS
Home furnishings have become more demanded by consumers in India, Traditionally,
consumers focus on furnishing their houses in India was restricted to bedroom and sitting
room furniture. However, with increasing aspirations of consumers to give a better look to
their homes, they have started spending on other furnishing categories like dining and
kitchen.
Consumers have also started spending more time selecting their furniture. Apart from looking
at price, they are also paying more attention to aspects like colour, design and material types.
Consumers are compromising on cost and are opting for better quality and well-designed
furniture whilst buying for a new house.
Current value sales growth of home furnishings in 2016 was lower at 9% compared to 10% in
2015. Due to demonetisation, which was announced in the month of November, the sales of
home furnishings witnessed a slowdown as consumers faced a cash crunch. Due to this,
consumers were forced to postpone their purchases. For the same reason, the real estate
market in India took a hit that has indirectly affected sales of new furniture in the country.
Growth of home textiles was stagnant in 2016. Consumers continued to opt for low-value,
unbranded products, which is the reason for the slower growth. The industry in India is highly
unorganised with presence of many local manufacturers.
Within indoor furniture, dining and sofa beds were the fastest-growing categories in India in
2016 at 11% and 12%, respectively. Traditionally consumers in India did not use dining
tables, even though they had dining areas. However, with increasing disposable income
consumers have started buying dining tables for dining areas, particularly for their new
homes. Dining furniture in India was valued at INR52.8 billion in 2016.
Other sitting furniture accounted for 63% of the sitting furniture sales in India in 2016. With
more people relocating to different parts of the country for work or education, the proportion of
renters has increased when compared to home owners. Hence, demand for other sitting
furniture like chairs is increasing. A lower replacement cycle of these products aids growth
too.
The number of variants of sofas that manufacturers are offering is increasing in India.
Consumers are having numerous options of sofas available in terms of colours, design, price
and shape and at cheaper prices, which is encouraging consumers to buy sofas.
Sofa beds accounted for less than 2% of the sitting furniture sales in India in 2016. This
concept is new in India and is growing. With increasing real estate prices and sizes of the
house getting smaller, consumers are opting for sofa beds in order to save space.
Retail sales of barbeques in India are minuscule.
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Due to initiatives taken by the government to save electricity, consumers have started shifting
to LED. Current retail value sales of LED grew by 55% in 2016 and were valued at INR23.6
billion. The government is also distributing LED at subsidised pricing to encourage people use
more of this type of lighting source.
Home and home furnishing stores accounted for 87% sales of indoor furniture in India in
2016. With the increase in the number of online retailers, demand for products online is also
increasing as internet retailers offer a wider variety of products and at a cheaper price. Online
sales accounted for 6% of indoor furniture sales in India over the year.
COMPETITIVE LANDSCAPE
Phillips India Electronics led sales of home furnishings with 3% value share in 2016, followed
by Godrej & Boyce Mfg with a 2% share. The increase in the demand for LED has helped
Phillips India to maintain its leadership position in the industry, whilst Godrej & Boyce ranks
first in the largest category of indoor furniture.
Syska LED India witnessed an increase in its sales by 92% in 2016. The company has been
aggressively expanding its portfolio in LED, which has helped the company witness strong
growth.
Domestic players dominate sales of home furnishings in the country. Four out of the top five
companies are Indian companies. Indian consumers are highly sensitive about pricing and
home furnishings is a largely unorganised industry in India, which makes it tough for
international brands to compete.
Most consumers in India are not aware of brands, and as the industry is highly unorganised
unbranded products are highly demanded. This trend is expected to continue going forward
and it becomes important for manufacturers to decide on the price points.
Phillips India Electronics led in lighting with a 22% share in 2016. With growing demand of
LED, leading companies are expanding their product portfolios in the LED category and are at
the same time focusing less on CFL. Phillips India led sales of LED in India with a 29% value
share in 2016 followed by the rising Syska LED Lights with a 15% share.
Economy brands dominate the sales of home furnishings in India. Consumers in India are
highly price sensitive and do not spend much on home furnishing products.
PROSPECTS
Going forward consumers are expected to increase their spending on home furnishing
products. People are expected to place more importance on quality and design than on price,
which is expected to drive the sales of home furnishings in the country.
Value sales of home furnishing are expected to rise at a CAGR of 6% at constant 2016 prices
over the forecast period to reach INR846.2 billion. The forecast CAGR will be double that of
the review period constant value CAGR, as with increasing internet retailing and branded
products expected to be available at lesser cost, consumers are expected to shift from non-
branded products to branded products.
With changing preferences, consumers have started opting for customised products which
may be a potential threat to retail sales of home furnishings.
Constant value sales of kitchen furniture are expected to grow at a CAGR of 6% over the
forecast period to reach INR35.2 billion in 2021.
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HOME FURNISHINGS IN INDIA Passport 3
Government is taking the initiative to educate consumers about the advantages of using LED
and this will make consumers shift from CFL to LED. LED in India is expected to witness a
constant value CAGR of 37% over the forecast period to reach INR115.5 billion in 2021.
The demand for economy-priced products is expected to remain high. With increasing
competition from non-branded products leading manufacture are expected to maintain the unit
prices to increase demand.
During the forecast period companies are expected to launch new products in furniture, giving
more importance to colour, design and material of the product.
CATEGORY DATA
Table 1 Sales of Home Furnishings by Category: Value 2011-2016
INR million
2011 2012 2013 2014 2015 2016
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Lamps (LFL)
-- Compact Fluorescent 18,212.8 21,764.3 26,204.2 30,638.0 32,169.9 30,883.1
Lamps (CFL)
-- Light-Emitting Diode 1,730.0 2,782.1 4,570.8 7,885.5 15,211.8 23,574.1
Lamps (LED)
- Lighting Fixtures 3,443.9 4,002.2 4,654.9 5,256.4 5,845.1 6,446.8
Home Furnishings 380,958.8 423,906.1 476,515.1 532,949.0 587,904.1 639,580.4
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
store checks, trade interviews, trade sources
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INR million
2016 2017 2018 2019 2020 2021
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-- Electric Barbecues - - -
-- Gas Barbecues - - -
- Garden Sheds - - -
- Outdoor Furniture 2.5 3.0 15.9
Lighting 10.5 16.1 111.4
- Light Sources 11.1 17.1 120.2
-- Incandescent Lamps -8.6 -10.3 -42.0
-- Halogen Lamps -6.0 -7.2 -31.3
-- Linear Fluorescent Lamps (LFL) -3.6 -4.7 -21.4
-- Compact Fluorescent Lamps (CFL) -9.1 -9.8 -40.4
-- Light-Emitting Diode Lamps (LED) 44.2 37.4 389.8
- Lighting Fixtures 4.6 4.4 24.1
Home Furnishings 4.2 5.8 32.3
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Euromonitor International