While the market expected the sector to witness contraction in the third quarter of the fiscal, post demonetisation, Ind-Ra expects most companies in the organised retail sector to post low single digit growth with varying impact across different sub-sectors.
Organised retailers in the food, grocery and fashion retail segments to be unaffected, given the relatively low average ticket size of transactions (around INR 2,000) and the willingness of consumers to switch to cashless transactions, Ind-Ra said.
The cash crunch impaired the traditional wholesale and retail channels and led to a shift in consumers from local grocery stores to supermarkets or hypermarkets, it explained.
Additionally, footfalls were also driven by the availability of cash withdrawal facility from the POS machines installed at some of these stores supported by the discount and promotional offers.
Also Read
It remains to be seen whether organised retail will continue to gain market share at the cost of unorganised retail post re-monetisation or the customers will go back to their preferred mode of transaction once the currency notes are replaced completely, it said.
Disclaimer: No Business Standard Journalist was involved in creation of this content