India’s total textile and apparel industry size (domestic + exports), estimated at $89 billion in 2011, is projected to grow at a CAGR of 9.5 per cent to reach $221 billion by 2021. Of this, the domestic market is estimated at Rs. 273,000 crores ($58 billion) and is expected to grow at nine per cent CAGR to touch a level of Rs. 664,000 crores ($141 billion) by 2021.
The contribution of textiles and apparels to India’s GDP is 5.14 per cent including the domestic and export markets. Employment in the Indian textile and apparel sector stands at 45 million and, with an additional employment of 60 million in allied sectors, both totalling to 105 million. Currently menswear is the biggest segment of the apparel market. However, kidswear and women’s wear are growing faster than the men’s segment with kidswear (girls) having the highest growth rate.
Innerwear
Currently the inner wear segment in India is estimated at about $4 billion and is expected to grow at a CAGR of approximately 12 per cent over the next decade. Men’s innerwear forms around 41 per cent of the total market in value and is projected to grow at a CAGR of nine per cent whereas the women’s innerwear segment is expected to grow at a faster pace with a CAGR of 14 per cent with the share increasing from the current 59 to 70 per cent by 2020.
The innerwear market in India is underpenetrated with per capita spending 90 per cent below that of Thailand and China. The market has been growing faster than the overall clothing market, driven by the premium segments. With discretionary consumer spend in India continuing to grow, these trends should persist, aided by rising urbanization and growth in consumer incomes.
Indian consumer spend on innerwear products is significantly lower than its Asian peers. This trend is visible across both men’s and women’s segments with a gap of over 90 per cent against countries like Thailand and China. This suggests that there is significant room for growth driven by rising per capita spending on such products.
Innerwear has graduated from being just a functional category to one that offers additional fashion quotient, and also from being a price sensitive category to a brand sensitive category.
Swimwear and swim-related equipment
The swimwear and swim-related equipment market in India is estimated at over Rs. 200 crores. Swimming is still at a nascent stage in India and is expected to evolve rapidly due to factors such as growing fitness consciousness among the youth. In addition, swimming is being increasingly preferred as a hobby, recreation and fitness sport due to the growing availability of swimming pools.
There are an increasing number of consumers holidaying at beach destinations locally and abroad, and this is giving a boost to beach culture. Hence the market potential looks promising.
Kidswear
The kidswear segment can be divided into boys and girls. The overall size of the boyswear market stands at approximately $4 billion, and the same is projected to grow at a CAGR of 10 per cent and reach $11 billion by 2021. The girlswear market is also expected to grow in a similar way.
The kidswear market is expected to register a high growth rate in the years to come due to multiple factors. There is a shift in the family system towards more nuclear arrangements with double-income parents. The willingness of parents to spend is higher and there are more options available in the kidswear space.
Online apparel retail
Online retail is another growing phenomenon in the Indian retail market. Changing lifestyles, increasing time constraint and the convenience to buy things online has paved the way for Indian consumers to have a consumer-friendly and hassle-free online shopping experience. The current market for non-store retailing in India is estimated at $3.2 billion and is growing at a rate of over 23 per cent.
The growth in the apparel segment will be primarily driven by the growth in modern retail. Currently comprising 18 per cent of the total market, the modern retail share is poised to grow sharply over the years to contribute a 25 per cent share. The increased presence of retail formats across hypermarket, specially retail formats, cash and carry as well as e-commerce should drive the growth of modern retail.
The other factors contributing for the increase in usage of apparels are growing urbanization, larger marketing spend by companies creating general awareness for the category, increased brand awareness among consumers and the growing shift from the unorganized to the organized sector.