Mumbai, September: Amid all euphoria over rising digital consumption in the retail space, the contribution of malls to organized retail sales is expected to rise to around 30 percent by 2028 from the current level of 19 percent, said Praveen Govindu, Partner, Deloitte India, Thursday.
Speaking on the second day of the two-day MAPIC India conference, he estimated that India’s total retail sales would grow from USD 58 billion in 2023 to USD 136 billion by 2028.
However, there is a need to accord industry status to the shopping malls to overcome the challenges of taxation and also facilitate the availability of credit, Govindu said.
Other speakers at the 19th edition of the conference, which was launched as India Retail Forum in 2004, pointed out that tier-II to IV cities have been able to generate sales in malls as much as in metro cities.
According to Govindu, Indian malls have around 1.5 times daily footfalls with a 25-30 percent higher conversion rate compared to high streets and 45 percent of the customers were spending more time at the malls than any other shopping avenue such as high streets and other local markets.
Speaking at the panel discussion later at the conference, Shibu Philips, Director, Shopping Malls, Lulu Group India, pointed out that tier II and III markets will largely contribute towards increased sales from shopping malls.
“Average purchase by value at a tier II mall was Rs. 21,400 while the same in a metro city like Mumbai was Rs. 24,000 as people who have reverse migrated to their hometowns post-pandemic have aspirations backed by the purchasing power. Moreover, over the past decade, USD 6 billion was invested in building shopping malls, which grew by 35 percent in the tier II market,” Philips said.
By 2030, India will add 140 million middle-income people and 21 million high-income middle class. The consumption story in Asia’s third-largest economy will continue unabated, he added.