Wedding-related consumptionhas remained muted this fiscal year, unlike FY23, due to absence ofpent up demand, lower number ofwedding datesand overall impact ofconsumption slowdown,chief executivesof several companies said.
As per industry estimates, sales of categories like ethnic wear and wedding wear, gold jewellery and electronic household appliances have declined by 10-20% in FY24 till February as compared to the same period in FY23.
However, luxury and premium products bucked the trend of sales decline mirroring the overall trend in consumption, chief executives said.
Wedding and ethnic apparel manufacturerVedant Fashions, popular for brands like Manyavar and Mohey, told investors recently that during nine months of this fiscal ending December 2023, the company’s overall performance got impacted due to significantly lower weddings, general slowdown impacting consumer sentiment and higher base effect of last year postCovid.
“When we talk to all the people in the industry this includes banquet hall owners, five star hotels, event organizers we see an overall trend where everyone is kind of commenting that the (wedding) business this year has been lower than last year,” said Vedant Modi, chief revenue officer at Vedant Fashions. He said there is a bit of “economic slowdown” across the board especially in tier two and tier three markets.
The rising gold prices have been an added damper. Gold prices have been moving upwards since October after the war between Israel and Palestine broke out with prices jumping by 7.6% from Rs 61,000 per 10 gm in early November to a record high of Rs 65,635 per 10 gm on Monday. As a result, demand for gold jewellery is down by more than 20% between November to February as compared to the same period last fiscal.
Titan chief executive (jewellery division) Ajoy Chawla recently told analysts that there is no significant boost due to weddings. The company runs the top jewellery chain Tanishq.
The mass market wedding jewellery is worst affected while the luxury items decked with diamonds and coloured gemstones are bucking the trend, said Ishu Datwani, director of Mumbai-based Anmol Jewellers.
Sales of mass segment right from fast moving consumer goods, apparel, shoes or electronic products have been impacted since Covid followed by high inflation and poor consumer sentiments across both urban and rural India.
The projections on demand improvement have been delayed from last year to the next fiscal with strong macros being a ray of hope. The Reserve Bank of India governor Shaktikanta Das last week said India’s economy will grow faster than the earlier estimate of 7.6% in FY24 and may grow at 7% next fiscal too.
Refrigerator and washing machine manufacturer Godrej Appliances business head Kamal Nandi said the mass products did not get the expected sales bump due to weddings this season and now the only hope is a weather based recovery in demand in summer.
The wholesale textile market of Surat, which caters to smaller towns and rural India, reported a 40% drop in wedding demand, an industry executive said.
This is a sharp contrast to what leading apparel manufacturer Aditya Birla Fashion & Retail reported last quarter for its designer brands largely driven by the wedding season — Sabyasachi grew 43% year-on-year with highest ever quarterly revenue, Shantnu & Nikhil posted 30% growth and House of Masaba 16%.
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