Diwali 2024: Total Sales Of Rs 1.25 Lk Cr Seen, Inflow Of Rs 1.75 Lk Cr Expected Ahead Of Wedding Season

Despite high inflation, Indian consumers opened their wallets wide this Diwali season, pushing festival-related spending to a record Rs 1.25 lakh crore, according to data from the Confederation of All India Traders (CAIT). This is the highest festive trade figure recorded in the last decade, surpassing even CAIT's optimistic forecast of Rs 1 lakh crore for the Diwali season. Total consumer spending by year's end is projected to reach nearly Rs 3 lakh crore.

The remarkable growth in Diwali sales, which last year amounted to Rs 72,000 crore and Rs 60,000 crore in 2019, has been attributed to reduced COVID restrictions and a boost in consumer confidence due to higher vaccination rates. CAIT's Secretary General Praveen Khandelwal emphasized that this year's shopping frenzy was not simply "revenge buying" but a more sustainable trend as consumers enjoyed a variety of new choices and competitive prices.

Delhi alone saw spending of approximately Rs 25,000 crore, with major retail verticals including FMCG goods, consumer durables, electronics, and home décor experiencing strong demand. As the festival season winds down, retailers are preparing for the next wave: the wedding season, which starts in mid-November and promises another burst of consumer activity.

The shopping list was long and varied this year, encompassing both traditional and modern goods. Earthen lamps, candles, paper mache decorations, and other handicrafts saw substantial sales, bringing in profits for small-scale potters, craftsmen, and artisans. Popular consumer items such as sweets, dry fruits, and fashion clothing were also in high demand. Meanwhile, consumer durables, electronics, home furnishings, and kitchen appliances enjoyed their own surge.

The jewellery sector witnessed brisk business too, with gold and silver purchases totalling over Rs 9,000 crore. Despite rising gold prices, the precious metal continued to be a festive favourite for its symbolism of prosperity.

Mobile phones were among the hottest sellers this season, with a 12-15% rise in the average selling price, driven partly by a shortage in device availability. This scarcity led to consumers grabbing whatever stock was available, resulting in an increase in the average price of phones sold. Counterpoint Research reported that the average selling price (ASP) of phones sold online was Rs 19,000 this year, up from Rs 17,000 in 2020 and Rs 13,000 in 2019.

Festive offers and discounts, as well as smart financing options like "buy now, pay later" (BNPL), propelled sales further. According to RedSeer, smartphone sales alone during the first week of festive sales generated around Rs 68 crore in revenue per hour. Xiaomi reported over two million units sold within five days of the festive sales, while competitor Realme sold over a million units within the first three days.

Credit card usage also hit new highs, with card spending reaching Rs 80,000 crore in September-a 57% increase from last year-and expected to exceed this in both October and November. Average monthly spending on credit cards rose to Rs 12,400, up from Rs 10,700 earlier in the year, according to a report by Motilal Oswal. The Reserve Bank of India's latest data showed credit card transactions hitting Rs 80,477 crore in September, a 3.2% rise from August. Credit card additions were also robust, with 1.09 million new cards issued in September, marking the highest issuance rate in nearly a year.

The BNPL segment saw a 25-35% uptick in demand, reflecting a growing preference for flexible payment options among young consumers. This trend was especially pronounced among new shoppers from tier 2 and tier 3 cities who contributed to the online shopping boom.

Both Amazon and Flipkart reported a strong Diwali season, with Flipkart leading with a 64% market share during the initial October sales. Sales from online platforms saw year-on-year growth of 23%, with goods worth Rs 32,000 crore sold in just the first week of festive sales. Amazon reported participation from 99.7% of Indian pin codes, while local shops on Amazon recorded a twofold spike in orders, selling over 10 products every minute.

Data from Flipkart provided some interesting insights: over 1.2 lakh chocolate bars were sold in a single day, and lakhs of smartphones were purchased. Watches were sold at a rate of one every two seconds. These staggering figures underscore the depth of consumer enthusiasm and the high levels of engagement seen across all categories.

As the festive season continues, the year-end forecast suggests consumer spending could touch Rs 3 lakh crore, a level not seen in years. Retailers are optimistic that this wave of spending is not a one-time occurrence but signals a broader, sustained demand driven by an increased comfort with digital shopping, access to flexible credit, and a resilient consumer sentiment bolstered by the economic recovery.