Report Overview

India Travel Retail Market – Industry Trends & Forecast Report, 2030

The India Travel Retail Market size was estimated at USD 1.89 billion in 2023. During the forecast period between 2024 and 2030, the India Travel Retail Market size is projected to grow at a CAGR of 7.89% reaching a value of USD 3.03 billion by 2030. A prominent driver of the market is the increasing number of domestic and international travelers. Travel retail involves the sale of various goods and services in locations like airports, cruise ships, and border crossings, offering duty-free shopping opportunities. Also, rising incomes in India enable more spending on travel retail, while improved air connectivity enhances travel convenience. Notably, India's growing reputation as a tourist destination attracts more international visitors, boosting the market further. Changing consumer preferences towards unique and high-quality products also drive increased purchases from travel retail outlets.

Travel Retail – Overview

Travel retail refers to the sale of goods and services to travelers in transit locations such as airports, cruise ships, border crossings, and international train stations. These outlets typically offer a variety of products, including cosmetics, perfumes, alcohol, tobacco, luxury items, electronics, and souvenirs. One notable aspect of travel retail is the provision of duty-free shopping, allowing travelers to purchase items without paying certain local taxes or duties, thereby often offering them at lower prices compared to retail stores elsewhere.

India Travel Retail Market

Growth Drivers

Expanding Tourism Industry

India's burgeoning tourism industry is significantly shaping the country's travel retail market, witnessing a surge in demand for goods and services from outlets like duty-free shops, airport boutiques, and hotel stores. This rise in demand is driving market expansion, prompting the establishment of new retail spaces and the expansion of existing ones. Tourists' evolving preferences and spending habits are influencing the products available in these stores. India's thriving tourism sector is a key force propelling growth and transformation in the travel retail market. In response to the increasing popularity of coastal tourism, a leading online travel agency in India has launched the 'Beaches of India' campaign, promoting the nation's coastal attractions as desirable tourist destinations.

Shifting Consumer Preferences

Consumer preferences in India's travel retail sector are undergoing a notable shift. With evolving lifestyles and increased exposure to global trends, travelers now seek unique and high-quality products. This inclination towards exclusive offerings is reshaping the assortment of goods available in duty-free shops, airport boutiques, and hotel stores. As consumers prioritize experiences and value authenticity, there's a growing demand for products that reflect their individuality and cater to their discerning tastes. This shift underscores the importance for retailers to adapt their offerings to align with changing consumer desires, thereby enhancing their competitiveness in the market.

Rising Disposable Income

The surge in disposable incomes, constituting close to 60% of the GDP, propels the growth of India Travel Retail Market. As consumers become more affluent and well-traveled, there's a notable shift towards discretionary spending, especially on leisure and business travel. This reflects the dynamic and upwardly mobile nature of modern India, signaling immense potential for the travel retail sector. Additionally, a study by Oxford Economics forecasts New Delhi and Mumbai to emerge as the world's largest consumer cities for middle-income households by 2030, further affirming India's rising economic stature and its promising outlook for retail growth.

Challenges

Fluctuations in Economic Growth

The COVID-19 pandemic has brought about significant economic fluctuations in India Travel Retail Market. With a sharp decline in passenger numbers and a shift towards online shopping, duty-free spending behavior has been profoundly affected. These fluctuations pose challenges to travel retail operators, requiring them to adapt to evolving market conditions to maintain profitability.

High Operating Costs

Operating duty-free retail spaces in airports entails substantial costs. Despite generating significant revenue, these spaces require extensive maintenance and operational expenses. To address these high operating costs, duty-free operators are increasingly exploring innovative strategies, such as online pre-purchase orders to optimize efficiency and profitability.

Impact of Escalating Geopolitical Tensions on India Travel Retail Market

Geopolitical tensions can have a multifaceted impact on the India Travel Retail Market. Uncertainty and security concerns deter international travelers, impacting duty-free sales at airports and other travel retail outlets. Reduced tourist influx affects revenue streams and disrupts supply chains, leading to decreased consumer confidence and spending. Additionally, fluctuations in currency exchange rates and trade restrictions further exacerbate the situation, hindering market growth. To mitigate these challenges, stakeholders must closely monitor geopolitical developments, implement robust security measures, and diversify market strategies to adapt to changing dynamics and sustain resilience in the face of geopolitical uncertainties.

India Travel Retail Market

Segmental Coverage

 India Travel Retail Market – By Product Type

By product type, the India Travel Retail Market is divided into Wine & Spirit, Fashion & Accessories, and Perfume & Cosmetics segments. The wine & spirit segment holds the highest share in the India Travel Retail Market by product type. It can be attributed to various factors. India's rising middle-class income, along with the relaxation of pandemic restrictions, has led to a surge in consumption and a preference for premium goods. This trend extends to beverages, with increased demand for brown spirits, sparkling wine, whiskey, and agave-based spirits. Duty-free stores, offering a wide array of products and enticing promotional deals, are particularly attractive to Indian consumers. Notably, duty-free shops upon arrival at airports outpace those upon departure, with alcohol leading sales, possibly due to competitive pricing. Overall, arrivals significantly contribute to duty-free sales as travelers often make purchases upon returning to cities.

India Travel Retail Market – By Channel

Based on channel, the India Travel Retail Market is bifurcated into Down Town & Hotel Shops and Airports segments. The airports segment holds a higher share in the India Travel Retail Market by channel. Rising disposable incomes have led to increased airport traffic, with passenger numbers expected to grow significantly. Airports serve as prime retail spaces, benefiting from captive audiences with considerable spending capacity during wait times. Government initiatives like privatization and schemes to improve regional connectivity further boost the retail potential of airports. Consequently, airports have emerged as dominant players in the travel retail market channel, surpassing other channels in terms of market share.

India Travel Retail Market – By Region

Geographically, the India Travel Retail Market is divided into North India, South India, East India, and West India regions.

Competitive Landscape

Major players operating in India Travel Retail Market include Dufry, Delhi Duty Free Services Pvt Ltd, Lotte Duty Free, The Shilla Duty Free, Flemingo Travel Retail, Travel Food Services (TFS) India, Cochin Duty Free, Hyderabad Duty Free, HMY, and Relay India. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In March 2024 - The 2024 APTRA India Conference was held in New Delhi. The conference explored India's growing influence on global retail. With expanding consumer horizons, the Indian market offered opportunities for new brands like Diageo's Tequila Don Julio 1942 and beauty brand NARS.

• In October 2023 - Kreol Travel Retail was appointed as the distributor for Skross in India, aiming to expand the Swiss company's presence in one of the world's fastest-growing travel destinations. Skross specializes in travel adapters and accessories.

Scope of the Report

By Product Type

• Wine & Spirit

• Fashion & Accessories

• Perfume & Cosmetics

By Channel

• Down Town & Hotel Shops

• Airports

By Region

• North India

• South India

• East India

• West India

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. India Travel Retail Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Rising disposable income
         2. Expanding tourism industry
         3. Shifting consumer preferences
         4. Convenience
      2. Restraints
         1. Economic fluctuations
         2. High operating costs
      3. Opportunities
         1. Technology integration
         2. Duty-free shopping
      4. Challenges
         1. Stringent regulations
         2. E-commerce competition
   3. Technological Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. India Travel Retail Market: Marketing Strategies
5. India Travel Retail Market: Pricing Analysis
6. India Travel Retail Market Overview
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Million)
   2. Market Share & Forecast
      1. By Product Type
         1. Wine & Spirit
         2. Fashion & Accessories
         3. Perfume & Cosmetics
      2. By Channel
         1. Down Town & Hotel Shops
         2. Airports
      3. By Region
         1. North India
         2. South India
         3. East India
         4. West India
7. North India Travel Retail Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Million)
   2. Market Share & Forecast
      1. By Product
      2. By Channel
8. South India Travel Retail Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Million)
   2. Market Share & Forecast
      1. By Product
      2. By Channel
9. East India Travel Retail Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Million)
   2. Market Share & Forecast
      1. By Product
      2. By Channel
10. West India Travel Retail Market
    1. Market Size & Forecast, 2019–2030
       1. By Value (USD Million)
    2. Market Share & Forecast
       1. By Product
       2. By Channel
11. Competitive Landscape
    1. List of Key Players and Their Offerings
    2. India Travel Retail Market Company Market Share Analysis, 2023
    3. Competitive Benchmarking, By Operating Parameters
    4. Key Strategic Developments (Mergers, Acquisitions, Partnerships, etc.)
12. Impact of Escalating Geopolitical Tensions on India Travel Retail Market
13. Company Profiles (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, and SWOT Analysis)
    1. Dufry
    2. Delhi Duty Free Services Pvt Ltd
    3. Lotte Duty Free
    4. The Shilla Duty Free
    5. Flemingo Travel Retail
    6. Travel Food Services (TFS) India
    7. Cochin Duty Free
    8. Hyderabad Duty Free
    9. HMY
    10. Relay India
    11. Other Prominent Players
14. Key Strategic Recommendations
15. Research Methodology
    1.       Qualitative Research
       1.   Primary & Secondary Research
    2.       Quantitative Research
    3.       Market Breakdown & Data Triangulation
       1.   Secondary Research
       2.   Primary Research
    4.       Breakdown of Primary Research Respondents, By Country
    5.       Assumptions & Limitations

*Financial information of non-listed companies can be provided as per availability.

**The segmentation and the companies are subject to modifications based on in-depth secondary research for the final deliverable

List of Figures

Figure 1       India Travel Retail Market Segmentation

Figure 2       India Travel Retail Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2023

Figure 4       India Travel Retail Market Size, By Value (USD Million), 2019–2030

Figure 5       India Travel Retail Market Share, By Product, By Value, 2019–2030

Figure 6       India Travel Retail Market Share, By Channel, By Value, 2019–2030

Figure 7       India Travel Retail Market Share, By Region, By Value, 2019–2030

Figure 8       North India Travel Retail Market Size, By Value (USD Million), 2019–2030

Figure 9       North India Travel Retail Market Share, By Product, By Value, 2019–2030

Figure 10     North India Travel Retail Market Share, By Channel, By Value, 2019–2030

Figure 11     South India Travel Retail Market Size, By Value (USD Million), 2019–2030

Figure 12     South India Travel Retail Market Share, By Product, By Value, 2019–2030

Figure 13     South India Travel Retail Market Share, By Channel, By Value, 2019–2030

Figure 14     East India Travel Retail Market Size, By Value (USD Million), 2019–2030

Figure 15     East India Travel Retail Market Share, By Product, By Value, 2019–2030

Figure 16     East India Travel Retail Market Share, By Channel, By Value, 2019–2030

Figure 17     West India Travel Retail Market Size, By Value (USD Million), 2019–2030

Figure 18     West India Travel Retail Market Share, By Product, By Value, 2019–2030

Figure 19     West India Travel Retail Market Share, By Channel, By Value, 2019–2030

List of Tables

Table 1        India Travel Retail Market Size, By Value (USD Million), 2019–2030

Table 2        India Travel Retail Market Size, By Product, By Value, 2019–2030

Table 3        India Travel Retail Market Size, By Channel, By Value, 2019–2030

Table 4        India Travel Retail Market Size, By Region, By Value, 2019–2030

Table 5        North India Travel Retail Market Size, By Value (USD Million), 2019–2030

Table 6        North India Travel Retail Market Size, By Product, By Value, 2019–2030

Table 7        North India Travel Retail Market Size, By Channel, By Value, 2019–2030

Table 8        South India Travel Retail Market Size, By Value (USD Million), 2019–2030

Table 9        South India Travel Retail Market Size, By Product, By Value, 2019–2030

Table 10      South India Travel Retail Market Size, By Channel, By Value, 2019–2030

Table 11      East India Travel Retail Market Size, By Value (USD Million), 2019–2030

Table 12      East India Travel Retail Market Size, By Product, By Value, 2019–2030

Table 13      East India Travel Retail Market Size, By Channel, By Value, 2019–2030

Table 14      West India Travel Retail Market Size, By Value (USD Million), 2019–2030

Table 15      West India Travel Retail Market Size, By Product, By Value, 2019–2030

Table 16      West India Travel Retail Market Size, By Channel, By Value, 2019–2030

Table 17      Dufry Company Overview

Table 18      Dufry Financial Overview

Table 19      Delhi Duty Free Services Pvt Ltd Company Overview

Table 20      Delhi Duty Free Services Pvt Ltd Financial Overview

Table 21      Lotte Duty Free Company Overview

Table 22      Lotte Duty Free Financial Overview

Table 23      The Shilla Duty Free Company Overview

Table 24      The Shilla Duty Free Financial Overview

Table 25      Flemingo Travel Retail Company Overview

Table 26      Flemingo Travel Retail Financial Overview

Table 27      Travel Food Services (TFS) India Company Overview

Table 28      Travel Food Services (TFS) India Financial Overview

Table 29      Cochin Duty Free Company Overview

Table 30      Cochin Duty Free Financial Overview

Table 31      Hyderabad Duty Free Company Overview

Table 32      Hyderabad Duty Free Financial Overview

Table 33      HMY Company Overview

Table 34      HMY Financial Overview

Table 35      Relay India  Company Overview

Table 36      Relay India  Financial Overview