Indian manufacturers pin hopes on a bumper festive season

As the festive season approaches, companies are pulling out all the stops to boost sales, offering deep discounts, easy consumer loans, and massive promotional campaigns to lure customers back into stores. This effort is crucial, as manufacturers are treading cautiously, given the recent consumer behaviour during past festive periods, which usually peak between Onam and Diwali, concluding with the Christmas season.

India's consumer goods and retail market has been struggling for some time. Economic distress caused by the pandemic, coupled with job shortages and rising inflation, has curbed the spending power of low-to-middle-income households. Although the fiscal year (FY25) began on a positive note, the arrival of monsoon dampened the mood as heavy rains impacted consumption further.

As a result, companies across sectors — from two- and four-wheeler manufacturers to home appliance makers and real estate developers — are on high alert, hoping for a strong rebound.

Take Hyundai Motor India, for instance. The country’s second-largest passenger vehicle maker has launched its "Hyundai Super Delight Days" campaign, offering attractive benefits. "Under the scheme, customers can avail benefits of up to ₹80,629 on the Hyundai VENUE, up to ₹58,000 on the Grand i10 NIOS, up to ₹42,972 on the sporty-entry SUV Hyundai EXTER, and up to ₹55,000 on the Hyundai i20," said Tanuj Garg, Whole-time Director & Chief Operating Officer at Hyundai Motor India.

Like the automotive sector, sales of consumer durable goods also peak during the festive season. According to Parag Kulkarni, Senior Vice President-International and President at A. O. Smith India, festive sales contribute significantly to the annual sales of consumer durables. "We anticipate a promising festive season this year, with strong sales growth. The launch of new products, attractive deals, and expanded distribution, especially in tier-2 and tier-3 cities, should drive demand. Aggressive marketing strategies by brands also create excitement, encouraging consumers to make purchases. Overall, we are optimistic that festive demand will significantly contribute to overall growth in 2024," he said.

In the housing market, homebuyer enthusiasm has been noticeable since late 2021, but recently there have been signs of distress, with home sales plunging by 11% in the September quarter across India's top seven markets. "As we enter the festive season, we are already seeing a surge in inquiries, which should translate into strong sales as the season progresses. We expect around 20% growth compared to last year’s festive season. We also hope that the RBI will reduce the repo rate in the upcoming monetary policy, giving the real estate sector a much-needed boost," said Ramani Sastri, Chairman & MD of Sterling Developers.