India`s grocery market projected to reach $992 billion by FY30
The domestic grocery market could reach about $992 billion by FY30, while roughly 91 per cent of purchases still continue to flow through stores (kiranas), leaving a large untapped digital opportunity in the country, a report said on Friday.
The report from Redseer highlighted that over 150 million Bharat households are expected to account for more than $1 trillion in annual consumption by FY30, with groceries their largest spending category, and that e?commerce today captures only about 3 per cent of the grocery market.
It further projected that this would rise to roughly 7 per cent by CY30, which would represent one of the greatest demand unlocks in Indian retail history.
India’s overall grocery market is on its way from $658 billion to $992 billion by FY30, growing at over 8 per cent CAGR.
The next decade of grocery growth will not be won by extending metro strategies into Tier-2 and Tier-3 markets.
However, brands that succeed will redesign their portfolios, pricing and distribution around the realities of domestic consumers.
Buyers prefer branded, packaged and healthier products in regional assortments, smaller pack sizes and value-driven pricing, according to the report.
A scaled value grocery player currently carries roughly 278 regional and private-label brands, which is more than three times what legacy e-commerce platforms do.
Nearly 58 per cent of its SKUs are regional or private labels, compared to 18–20 per cent on legacy platforms.
The report found a 'value grocery' model emerging built around deep regional selection, private labels, and low-cost fulfilment, creating a scalable pathway to bring India’s next 100 million online shoppers into digital commerce.
By CY30, domestic households will consume roughly $1 trillion worth of goods and services every year.
Such households are India’s lower-middle-income families, spread across tier 2 and tier 3 cities, towns, and semi-urban India.
About $1 trillion is a market driven by over 150 million households who carry a compounding spending power of roughly 4-5 per cent every year, the report added.
