The 18,000 Crore baggage industry in India in India is in the middle of a shock because the New Age players challenge the dominant legacy companies. According to a crisil report, the luggage industry has grew 3 percent annually in the past 3 years and is expected to be expected at 5 to 7 percent in this financial year.
While the industry is growing at a steady pace, the new age companies grow much faster. The CRISIL report stated that the organized actors currently have a 45% share of India's luggage market, but the New Age players are now checking 25 percent of the organized luggage market. The report explained that this is due to the increasing competition by the New Age players. The legacy players' margins declined by 8 percent in the fiscal year25.
What gives the New Age Companies an advantage?
The New Age baggage companies focus on fast-moving and contemporary designs in various luggage segments. Crisil emphasized that “their focus on the aspiration class and the inexpensive production of private individuals helps them to compete with the legacy players with deep pockets and an extensive sales network.”
Rahul Guha, Senior Director of Crisil Ratings, said that the New Age companies have doubled their market share in the last two financial years, even though the Legacy players continue to invest in online channels. “Superior designs, inexpensive production of private labels, controlled overhead costs and a greater range Due to the spread of e-commerce, new luggage manufacturers can be able to grow faster than the big ones.”
Luggage sector inventory
The Crisil report explained that the legacy actors cleared their inventory with low margins, and overall the industry has an appropriate industry capacity. For this reason, there will be little debt debt in this sector in this financial year.
“This financial year will correct this financial year to about 3 months in the last two fiscals, since the manufacturers have their older inventory. Capacity degree in the last 2 Fiskals has currently led to the use of 70-75%,” added Himank Sharma.