Discretionary demand on the mend in June-July; cos see full recovery in second half of fiscal year

economictimes.indiatimes.com:

There has been a further acceleration in demand recovery in July, they added, attributing the pick-up to a slowing in inflation among other drivers. They are confident of a complete recovery in the second half of the fiscal year, as festive season spending kicks in.

Shoppers Stop CEO Venugopal G Nair told analysts on Tuesday that sales in June improved and July is continuing along the same lines. He said the company saw a rise in footfall during the end-of-season sale that began in June.

Electronic products company Havells India chairman and managing director Anil Rai Gupta said while April and May were muted, June saw growth in all product categories. He sees demand recovering, including in rural India, for products such as refrigerators, switchgear and wires in the second half of the year.

On Tuesday, the International Monetary Fund (IMF) raised India's growth forecast for FY24 to 6.1% from 5.9% estimated earlier, citing strong domestic investment.Other high-frequency indicators such as goods and services tax (GST) collections, corporate debt issuance, manufacturing PMI and credit demand also signal revival. Discretionary consumption has been impacted across categories since last year's Diwali with people shying away from purchases due to high inflation, job losses in some sectors such as startups and IT, and the overall macroeconomic scenario.Banking on festive season Companies in sectors such as apparel, lifestyle retail, electronics and quick service restaurants (QSRs) have all said business has been slowing since November-December last year.

A mild summer weakened demand for discretionary seasonal products such as air-conditioners and refrigerators. The industry said this has been the worst summer in over a decade