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Ever since the government started easing Covid-19 curbs, India’s retail sector has been steering towards recovery, along with quick-service restaurants (QSR) and jewellers. Apparel makers, however, continue to lag, a report by Edelweiss Securities said. The study said retail sales for the June quarter are expected to grow at about 53% YoY, but revenues will most likely be 37% lesser than what it was a year ago owing to the damage done by the second wave of the Covid-19.

In terms of segments, QSRs are expected to exhibit the levels of recovery, thanks to the tweaks in the model which has inched towards the delivery and convenience model. Apparel retail would be at the opposite end, with the slowest recovery.

The road ahead

With fewer active cases and gradual easing of Covid curbs during the March quarter, there was a surge in business activity, coupled with enhanced consumer sentiment. A report by broking agency Anand Rathi said that top retailers in India were on the road to normalcy, with segments like innerwear, apparel, footwear, and department-store showing growth in revenue. Things, however, took a nasty turn in the following months, with the second wave engulfing the entire nation and nearly putting a full stop to non-essential retail. The report added that the majority of the companies expect a gradual recovery from Q2FY22 onwards, owing to factors like constrained demand, festivals, and more ease in restrictions.

In terms of sales by QSR, Jubilant Foodworks and Burger King India in January 2021 recovered 107% and 85%, respectively, of their January 2020 figures. Jubilant Foodworks runs Domino’s Pizza in India which saw a recovery of 94.4 % in sales in April, which came down to 87.7% in May and this was led by its delivery business.

As per a report by the Retailers’ Association of India, the overall retail sales in April 2021 were 49% lower than that of April 2019. The report which surveyed over 60 retailers across various categories concluded that segments that experienced a decline were restaurants, consumer electronics, footwear, apparel, and clothing reported a drop in business, with the sharpest one coming from beauty and wellness retailers.

As per the Edelweiss report, jewellery business performed really well across discretionary categories, with a demand surge in H2FY21, specifically in the wedding segment. Tanishq owner Titan Co. said in this month’s quarterly update that excluding bullion sales, it saw revenue growth of 117% in the June quarter. In spite of having much lesser operational days, the sales of June 2021 exceeded those of June 2020. As per Edelweiss, Titan is expected to see a 60% recovery in business YoY.