If there is one thing that drives Indian economy irrespective of what happens globally it is domestic consumption. With India slated to surpass China as the most populous nation in five years, the business opportunity around the local consumption story encompassing over 1.3 billion people is only going to grow. But challenges remain due to the fragmented consumption patterns among several other factors.
Multinational companies and few domestic Goliaths have traditionally dominated the big spaces in the consumer sector. But the diversity in consumer behaviour and the geographic spread of the market has allowed entrepreneurs to not just flourish but in many segments break out to emerge with top brands. Deal-making got a leg up last year with retail and consumer healthcare & nutrition spaces seeing big consolidation moves as well as PE interest. There were many more small and
mid-sized deals in the sector, be it beverages, food, salon chains, restaurants and even an incense stick maker found a PE backer.
Overall, PE and VC firms bet $3.6 billion across 277 consumer companies in 2018, according to VCCEdge. While dealmaking in consumer discretionary space was largely tilted towards e-commerce and has been gyrating to the tune of few big investments, staples as a category saw money-flow more than double to $1.2 billion last year.
Within the broader ecommerce sector, there has been a natural polarisation in the business commanded by horizontal players but still certain vertical ecommerce firms are fighting it out.
To gauge the emerging opportunities, discuss the challenges and how to overcome them, News Corp Mosaic Digital is hosting the next edition of Consumer & E-Commerce Investment Summit.