The consensus among businessmen and economists is that while some improvements have taken place, acche din are definitely quite some time away. Businessmen are still cautious about putting money in big, Greenfield projects - they would rather buy existing businesses and plants looking to sell. The real estate sector is still stagnant. Exports have been falling steadily despite the rupee falling vis-a-vis the dollar and, therefore, making some of our products and services more competitive. Hiring might be up in a few sectors, but not in any large numbers, and ditto for salaries. The past two quarters have seen profits getting squeezed, though revenue may be picking up. Though the data has not come out yet, many retailers say that the urban middle class is still postponing big-ticket purchases. Meanwhile, there is some evidence to suggest that rural income and rural consumption are slowing down.
There is one segment of the market that is completely unaffected by the gloom and doom of other sectors. The purveyors of luxury are not only seeing no slowdown, but many of them also say that the demand for luxury goods and services is growing at a fast clip. The merchants of luxury are notoriously cagey about sharing any numbers, but there are plenty of signs that they have nothing to worry about so far. Luxury car manufacturers - Mercedes, BMW, Audi and Jaguar Land Rover - have collectively seen sales increase year after year in the country. Sales of top-end luxury housing continue to show robust demand - especially in Mumbai and Delhi. A sea-facing triplex in Mumbai's tony Napean Sea Road recently changed hands for Rs 202 crore, setting a new benchmark. Meanwhile, the Essel Group in Delhi is reported to have picked up a bungalow in the coveted Lutyens Bungalow zone for over Rs 300 crore. The big fat Indian weddings are becoming even bigger and fatter, with industrialists spending upwards of Rs 50 crore or even Rs 100 crore to start off their children's marriages with the proper bang. Fine wines and Single Malt whiskies are selling quite briskly. And on any given day, you will find it difficult to find a parking place easily near DLF Emporio in Delhi, the mall that houses a number of luxury brand retailers.
What is behind the good times in the luxury segment? Well, for one, the rich keep getting richer, and the ranks of the super wealthy keep increasing, whether the overall economy is doing well or not. Two, a new group of young and recently rich consumers has come into the market - digital entrepreneurs well-funded by VCs are living the good life even as they are disrupting many a marketplace. Third, the love for lavish weddings is driving huge consumption in every sort of product and service from luxury liquor to Swarovski crystals and super premium cars.
Our annual luxury issue this year has been anchored by Deputy Editor Chitra Narayanan and Senior Editor Goutam Das. The entire Business Today team also chipped in, while our Art Editor Safia Zahid and Deputy Art Director Anand Kumar Sinha worked with Photo Editor Vivan Mehra and his deputy Shekhar Kumar Ghosh to give the issue a proper luxurious feel.
I hope you enjoy the issue as much as Team BT enjoyed putting it together...