The Indian watch market is set to more than double in the next five years to around Rs 8,500 crore growing at 10-15 per cent every year, driven by youth and premium segment of consumers, according to a report.
As per the report - Indian Time Wear Industry 2010 - published by All India Federation of Horological Industries (AIFHI) and consultancy firm Technopak Advisors, the current size of watch market in India is about Rs 4,000-4,200 crore.
In the past few years, the sector has seen a growth of 8 -10 per cent, it said.
"The watch market in India is expected to grow between 10-15 per cent annually to become around Rs 8,500 crore in the next five years," Technopak Chairman Arvind K Singhal said at the launch of the report.
He said factors like growing economy, increasing consumerism, strong middle class and a large number of high networth individuals, would favour the growth of the market.
Even expansion of modern retail in India will further fuel the growth of the sector as a watch is increasingly transforming into a lifestyle product from being just a time-keeping device, the report said.
In terms of volumes, the organised players currently command 40 per cent of the industry (around 460 lakh units annually) and the rest 60 per cent by the unorganised segment, which consists of smuggled watches, cheap imported watches and those assembled by small unorganised players.
However, in value terms, around 60 per cent of the total watch market in India is controlled by organised players that include domestic firms such as Titan, Timex, Maxima and HMT, and a host of international brands and companies such as LVMH, Seiko, the Swatch Group, Chanel and others.
According to AIFHI President Yashovardhan Sabbo, the sector is still facing several bottlenecks and challenges such as high import duties and varied taxations.
Foreign Direct Investment restrictions on single brand retail in India and the grey market are also areas of concern, according to AIFHI.
The report also suggests that the government should incentivise companies, both international and domestic, to make India as a manufacturing hub, especially in the sub Rs 1,000 watches, which are dominated by counterfeits and cheap Chinese imports.
"For most of the international watch brands, India is one of the top priority markets in the world. Companies are looking for an alternative to China to set up their manufacturing base and the government can play a vital role to make India the next destination," Seiko Watch India Vice President Sales and Marketing Niladri Mazumder said.
