Makers of luxury watches and leather goods expect a boost from Diwali sales, when Indians offer gifts to each other or purchase high-value items such as cars and homes as the period is considered auspicious.
Luxury carmakers such as Lexus and Lamborghini are lining up deliveries for their customers around this period. DLF’s luxury retail malls in Delhi, which house outlets of several luxury labels, are hoping sales will be buoyant on the back of increased spending.
Sharad Agarwal, head of the Italian sports carmaker Lamborghini India, said 2021 was a record year for the luxury car company, when it delivered 69 cars to record 86% growth over 2020. “We have seen good demand for our cars in India as well and are on track for consistent growth in 2022. The outlook is positive with an equal number of orders as there will be production in 2023," said the local head of the Volkswagen unit. The cars’ price range begins at ₹3 crore for its SUV Urus and about ₹5 crore for its Huracan variant. Similarly, Lexus India expects sales will exceed pre-pandemic record levels of 2019. Demand for the brand’s luxury car in India has crossed its highest in July since its launch in 2017. Naveen Soni, president of Lexus India, said the occasion-led sales expectations are not paramount since the purchase decisions are made well in advance. But Diwali is a good time for customers to acquire these purchases due to its auspiciousness. So, while orders are placed in advance, the company does look at sending out deliveries at this time.
In luxury retail, there have been steady gains in the business. The difference in buying a luxury product sold in the home country versus in India was about 30% earlier, but owing to a change in the duty structure, the gap has narrowed to 15-18%, making it almost on a par with global rates.
At Aditya Birla-owned The Collective, Diwali sees increased consumer interest in gifting. Each year, The Collective sees a jump of 40-50% in its accessories categories, such as watches and leather goods. The company hopes to triple its sales this Diwali from 2019.
In anticipation of the upcoming business season, DLF-owned luxury malls Emporio and The Chanakya in New Delhi have started the festive season with a focus on Indian couture, both meant for the festive season and weddings.
This week, Swiss luxury watchmaker Franck Muller is launching a watch collection for the Indian market, which local partner Kapoor Watch Co. will retail.
In the last two years, with people not travelling much, there was consistent consumption throughout the year for luxury watch brand Panerai, but this year is the first Diwali that most companies are banking on big festive sales. “There is a mood in the market to spend. We do expect a good upswing because of Diwali and wedding season. We should have our best year yet since our launch," said a company spokesperson for Panerai watches, which is part of the Richemont Group. International luxury brands see robust sales despite international travel opening, said Pushpa Bector, executive director, DLF Retail, head luxury and shopping malls at the firm.
“This year, the Indian couture designers -- who were highly dependent on large weddings that were largely absent for the last two years -- will see their purchases for wedding trousseaus go to an all-time high," said Pushpa Bector, executive director, DLF Retail, head luxury and shopping malls at the firm.
She said occasion wear and wedding wear would be at an all-time high this year since the wedding season will come in soon after an early Diwali. Watches and jewellery continue to do well. Fine jewellery company Hazoorilal Legacy is predicting a positive year, hoping to match its performance last year.
Rohan Narang, managing director, said, “We have seen a resurgence in footfalls and sales in 2022 which can be compared to the year 2019 at our stores, pre-pandemic. Even our online business has shown healthy growth since the launch in 2020."
Bector said international luxury brands see robust sales despite international travel opening. The cost difference between the home country and India has reduced, adding to the sustained growth in international luxury brands. She added that the company’s two luxury malls would also have their luxury shopping festival around the festive period. D
espite the pandemic, according to financial services firm Credit Suisse’s Global Wealth Report 2022, global wealth went up 9.8% at the end of 2021, reaching $463.6 trillion. India has witnessed a 12% year-on-year increase in household wealth in the same year, making it about $14.2 trillion, up by $1.5 trillion from 2020. Earlier this year, David Kellie, chief executive of Natural Diamond Council, said in 2022, India will recover and surpass 2019 numbers for diamond sales.
