Down to the wire: From mobiles to TVs, last-minute buys add spark to Diwali

Diwali is like a litmus test of consumer sentiment, but this time the industry is still waiting for the ‘last-minute’ shopping trends to emerge before giving a verdict.

 

The low-key mood reflected in the September quarter financial results of some of the marquee fast-moving consumer goods (FMCG) companies was yet to be replaced with an all-out shopping mania till the weekend before Diwali. Last-minute shopping is more spread out now with some retailers pinning their hope on the weekend after Diwali, expecting sales to peak by then.                       

Nilesh Gupta, managing director of Vijay Sales, a prominent electronics goods chain headquartered in Mumbai with stores across the country, told Business Standard that the coming weekend was expected to do well as consumers would flock stores to ensure they did not miss out on the Diwali offers.

   

As of last weekend, footfall in markets picked up, he said, adding that mobile phones and large screen TVs were performing especially well.

 

“The coming few days will be crucial, we expect to clock a 7-9 per cent growth (in value) this Diwali.’’

 

Last Diwali, the year-on-year (Y-o-Y) growth was estimated at around 10 per cent.  

 

Demand failed to pick up in the early part of the festival season because of widespread rain in several parts of the country besides the overall consumption slowdown. 

 

Avneet Singh Marwah, chief executive officer (CEO) of SPPL, which is a brand licensee of Kodak, Thomson, White Westinghouse and Blaupunkt, said: “There was a slowdown till Navratri, but sales have picked up since then and we expect this trend to continue till Diwali. We’ve witnessed a growth of 15-20 per cent year-on-year.”  

 

The weekend business wasn’t too robust in fashion and lifestyle retail, but it picked up during the week just days before Diwali.

 

“In the last two days, like-for-like sales are better than the weekend and are in mid-single digit. We are waiting and watching how the situation pans out even post Diwali as the wedding season approaches,” said Devarajan Iyer, CEO at retail chain Lifestyle. 

 

Retailers Association of India is more bullish. Its CEO Kumar Rajagopalan said: “Most retailers are seeing double-digit growth over Diwali last year.’’

 

According to him, retailers are cautiously buoyant in sentiment.

 

In the national capital, like in many other cities, all eyes are on last-minute shopping. 

 

“While there is no significant surge in sales, we expect an uptick in business this week…. we expect the business to become better each day this week,” said Atul Bhargava, president of the New Delhi Traders Association.

 

Earlier, things used to start off from Dussehra itself, but that is not the case anymore.

 

Confederation of All India Traders (CAIT) has, however, put up a brave number. The Diwali shopping spree by consumers is expected to generate a business of Rs 4.25 trillion this year, according to CAIT. Delhi alone is projected to contribute Rs 75,000 crore. 

 

 New Delhi-based DLF Group reflects the optimism.

 

“The last weekend before Diwali was a little tempered as the big Diljit Dosanjh concert pulled away the crowds, but we expect a strong season. Both retail and F&B have done well across our portfolio, with Promenade (in Vasant Kunj), Avenue (in Saket) and Mall of India (in Noida) especially seeing a spike in footfall and sales,” said Pushpa Bector, senior executive director and business head, DLF Retail.

 

At Broadway, the month-old experiential retail format store at Ambience Mall in New Delhi’s Vasant Kunj, sales have seen a slight uptick in the run-up to Diwali, said founder Vivek Biyani.

 

“There is some normalisation taking place, in that people don’t necessarily shop a lot only during the festival season, but throughout the year.”

 

 In Kolkata too, the consumer sentiment has picked up ahead of Diwali, after a lacklustre retail showing in the run-up to Durga Puja. A part of the Quest Mall that houses premium and luxury brands is under renovation and therefore sales cannot be compared with last year, but Sanjeev Mehra, CEO and executive director of Quest Properties, said: “If we look at Durga Puja, then sales are much ahead. The footfall and business last week has been really good.”

 

The scene is similar at the South City mall. Man Mohan Bagree, vice president of South City group, said Diwali sales were partly impacted by Cyclone Dana and the rains following it. “Sales are at the same level as last year. But sans the Dana impact, it would have been higher.”

 

At Kolkata’s New Market, the owner of a prominent saree shop said: “Footfall has picked up”.

 

But it’s a mixed bag out there. As Ashok Kumar Gupta, president, SS Hogg Market Traders’ Association, said sales during Durga Puja were down by about 40 per cent. “It has picked up since then, but overall sales are still down by about 25 per cent.”

 

Sushil Poddar, president of Confederation of West Bengal Trade Association, is hopeful that Diwali sales would be 10-15 per cent higher than last year.

 

The scene in Chennai is also one of cautious optimism. According to retail outlets in Chennai, festival sales have been disappointing post-Covid-19, and this year they have declined further.

 

As against high street stores, malls are talking of an “impressive uptick in footfall.”

 

 “For us, the business this season is not good. Normally, we achieve festival season sales of around Rs 60 crore. This year, it has decreased by at least 5-10 per cent across all industries,” said Ratnaraj P, vice-president of Chennai Pothys Textiles, a renowned textile chain in South India.

 

Ratnaraj points out that Diwali shopping duration, which used to last for 30 days, has shrunk to 15 days after the pandemic.

 

“The current trend is that business happens during the last two weekends. That is when you cover 40-50 per cent of your sales.’’

 

A senior executive at Phoenix Marketcity, one of the largest malls in Chennai, said: “We’re observing more customers making a beeline for the latest trends, especially in categories like apparel, jewellery, home decor, and electronics,’’ People are increasingly embracing premium and trendy offerings, said Nirmalkumar Damodaran, centre director - Phoenix Marketcity and Palladium in Chennai. 

 

T Nagar, a top shopping destination in Chennai, is experiencing a downward trend in sales. The ongoing flyover construction is contributing to the downturn.

 

Small business owners are seeing a considerable decline in sales as well. “We are seeing some festival push, but nothing similar to what it used to be before the pandemic except for the firecracker industry, everyone else is struggling,” said Soundararajan S, who leads the Tamil Nadu Vanigar Sangagalin Peravai (Federation of Traders’ Unions).