Page 113 - Nuvama | IC Report 2023

INDIA: THE 5D ADVANTAGE

The potential does not mean India’s consumption would shoot up to China’s level (a more pertinent
comparison given India’s market size). What these two reference points indicate is that the realisable
potential is much greater than what is currently understood, and may lie somewhere in-between,
broadly speaking, the two EM markets that are fairly large in their own ways.
In the humdrum of macro consumption, what’s often missed is that India’s consumption profile has
already changed a great deal. Mass is now only 29 percent of the overall consumption, whereas mid That the
makes up 42 percent and premium 29 percent. Meanwhile, if mass continues to contract and graduates mid segment is
to mid, the premium category can continue to expand for far longer than it is currently understood. the most dominant
implies the premium
All in all, the Indian consumer is coming of age, and is more confident of their incomes, more aspirational, segment has many
more brand as well as quality conscious, and less price-sensitive. This is encouraging companies to not legs still
only expand their product offerings, but to also introduce premium categories—leading to substantial
expansion of profit pools.

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