India’s retail and FMCG sectors continue to evolve rapidly, balancing promising growth with operational challenges. Quick commerce is making a significant splash, with FMCG giants witnessing a 50–100% surge in sales from the channel in FY25. Though its overall share remains modest at 2–4%, premium pricing and expanded reach underline its growing potential.
However, this digital shift is creating tension with traditional distributors. The All India Consumer Products Distributors Federation (AICPDF) is pushing back against preferential treatment given to q-commerce, demanding more equitable practices. This friction is further heightened by an indefinite boycott of Turkish-origin FMCG goods, declared by AICPDF in protest of Turkey’s geopolitical stance. The action is likely to affect chocolate and cosmetic categories across retail outlets and kirana stores.
Meanwhile, the FMCG sector has closed FY25 on a positive note. Despite persistent inflation and muted urban demand for much of the year, the final quarter brought strong growth in both volume and revenue, indicating a positive trajectory for FY26. In parallel, India’s retail sector is entering what analysts call a golden era, with over 16.6 million sq ft of Grade A mall space set to be added by 2026. This boom is fuelled by rising consumption and robust leasing activity.
Further bolstering sentiment is a sharp dip in retail inflation, now at a six-year low of 3.16% in April, thanks to easing food prices. This bodes well for consumer spending and market stability as we head deeper into 2025.
Click on the headings below for insights on how these trends are shaping India’s retail landscape…
1. Quick commerce sprints ahead but still a small slice for FMCG giants
Quick commerce has seen substantial growth for FMCG companies in India, with sales increasing by 50-100% in FY25. While still representing a modest 2-4% of overall sales for major players like HUL and Britannia, the channel's expansion into new locations and better margins due to premium product sales are noteworthy.
2. FMCG distributors up the ante
Fast-moving consumer goods (FMCG) distributors plan fresh action against companies favouring quick commerce over traditional trade. As q-commerce disrupts general trade with deep discounts, AICPDF pushes for fair distribution practices. E-commerce share in FMCG is rising, driven by convenience and urban market shifts.
3. FMCG distributors to indefinitely boycott Turkish chocolates, cosmetics
The All India Consumer Products Distributors Federation (AICPDF), representing 4.5 lakh FMCG distributors and over 1.3 crore kirana stores across the country, has launched an indefinite and total boycott of all Turkish-origin FMCG goods, effective immediately, it said in a statement on May 19. The backlash stems from Turkey’s support for Pakistan during its recent military conflict with India, during which swarms of drones, many of them of Turkish make, were fired at Indian defence and civilian areas.
4. Blazing Past Headwinds, FMCG Sector Sets Sights On Brighter FY26
While the prolonged slowdown in urban consumption and high food inflation kept the fast-moving consumer goods (FMCG) companies on their feet for the majority of the previous fiscal year (FY25), the fourth quarter recovery has again put them on the growth trajectory. Major players reported strong top-line and bottom-line gains, coupled with substantial steadiness in underlying volume growth in Q4FY25.
5. Retail boom: India to add 16.6 million sq ft of new mall space by 2025-26
India’s retail sector is witnessing a major transformation, with over 16.6 million square feet of new Grade A mall space expected to come up across top seven cities in 2025 and 2026. This surge is being driven by rising consumer demand and strong momentum in retail leasing, marking what experts call a golden era for the sector, according to data compiled by Anarock Research.
6. Retail inflation eases to 6-year low of 3.16% in April as food prices fall
Retail inflation, as measured by the Consumer Price Index (CPI), continued its downward trend in April, easing to 3.16 per cent — the lowest level since July 2019 — largely due to a decline in food product prices, the government reported on Tuesday. This represents a further drop from the 3.34 per cent recorded in March.