The Indian online retail industry is expected to grow by 50%-55% annually for the next 3 years.
According to global analytical firm CRISIL (Credit Rating Information Services of India Limited) India’s Ecommerce growth, whether the ease of FDI regulations is approved or not, will reach Rs 50,000-cr (roughly $12 billion) by 2016. Such predicted growth means the Indian online retail market would grow by 3000% since 2008.
During 2007 to 2008 India’s online retail market was Rs 1500-cr, these number have risen considerably and by the end of 2012 already reached Rs 13,900-cr ($3.1 billion), resulting in 56% year over year.
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The majority of India’s online purchases are travel related. Close to two thirds of the Indian Ecommerce market is due to travel, but CRISIL states the situation will be change in the future. The report states Ecommerce in India will pose a major threat to brick and mortar establishments, a scenario which has yet to be seen in India.
“From around 8 per cent share of the organized retail market in India now, online retailing will zoom to around 18 per cent by 2016. But as a proportion of overall retail — including the massive unorganized segment — it will be just over 1 per cent at the end of that year. Yet the potential is huge. For example, in the US, which is the biggest market for online retail, and the UK, the share of online retail is around 9-10 per cent. Even in a developing market such as China, it is 4-5 per cent,” stated Rahul Prithiani, Director of Industry Research for CRISIL.