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India’s food retail revolution: Growth, trends, and insights

The food retail sector claims 63% of the total retail market, while the e-grocery sector is booming. Interested?

supermarket chains in india

There has been a sea change in the Indian culinary and food retail sectors, especially after the pandemic. Even though it’s mostly an unorganised industry, retail sales in India contribute around 10% to the GDP. Moreover, the food and Indian grocery market size is the most significant today, with 63% of the total retail market.

The food retail business in India is booming, and it’s a multi-faceted industry that includes processors, distributors, retailers, and culinary service providers. 

While modern retailers have been steadily expanding their market share, especially in major cities, traditional merchants such as Kirana stores or local stores have steadily declined. However, they still make up more than 95% of India’s food stores. 

This article will talk about the culinary industry in India, market growth, and the top retailers in the country.

Understanding the food retail market

Any business that sells food to the general public is considered part of the food retail industry. Supermarkets, hypermarkets, grocery shops, convenience stores and speciality shops, some of which are part of larger retail networks and others of which operate independently, make up most of today’s retail commerce.

As we know, food and grocery stores dominate India’s retail landscape and are likely to expand because of the growing trend of premiumisation and processed food products.

Many factors have contributed to the changes in the grocery industry as a result of the pandemic’s uncertainty, including:

  • Adoption of digital technologies: India has had one of the fastest rates of digital usage in the world. Nearly 880 million people are online and 9,192 crore worth of deals were made digitally in 2022-23.
  • Inventiveness: New start-ups have emerged from digitalisation, and have customised their business strategies to fit the Indian market.
  • “Direct-to-consumer” transactions: A game-changer in the retail industry that is changing the game for Indian consumers.

Online grocery shopping has been growing since the e-commerce boom in India. With an estimated $2-3 billion in 2020 and a predicted $10-12 billion by 2025, the Indian e-grocery business has had a compound annual growth rate (CAGR) of more than 50%. Retail food and gourmet are projected to rank among the top direct-to-consumer segments by 2027. 

Also read: From street food to stock market: The rise of India’s QSR giants 

Current food retail market in India

In India, there are 12 million grocery stores, which makes it one of the most multifaceted food retail ecosystems worldwide. Urban and rural regions of India remain divided in the areas of development momentum for food retail.

There was a nationwide growth in the number of grocery stores and supermarket chains in India due to the development of today’s retail. While some companies have steadily increased store counts to strengthen their position in this industry, others have partnered with Kiranas to improve their infrastructure, rather than creating an us-against-them scenario.

In 2023, the online grocery store industry in India was worth more than 669 billion rupees. However, the online grocery market in India accounts for less than 1% of the market, while stores make up over 4%.

Future of culinary commerce in India

Tier 2 and Tier 3 cities are likely to contribute to the grocery segment’s future success in India. The rising purchasing power of food products is a natural consequence of the rapid urbanisation taking place in developing cities and semi-urban regions. 

However, due to improvements in employment creation, agricultural improvements, and the return of the labour class to rural areas, rural regions are expected to experience a rise in the quantity of consumption, also known as volume growth. The retail industry in India has enormous unexplored opportunities for growth, and giants of the retail sector are pouring resources into it. 

Also read: How is Coca-Cola planning to expand its business in India? 

On the other hand, businesses in India are investing in the quick-commerce industry. Now, with the help of quick commerce (q-commerce), the biggest names in online retail can get consumers their groceries in as little as ten to twenty minutes.

Businesses in India are investing capital in the fast-commerce industry. In 2025, the fast commerce industry in India might reach USD 5.3 billion. Compared to the standard e-commerce arrangement, q-commerce stands out due to its speedy delivery method. 

This industry is set for significant growth in the years to come thanks to innovative technology like drone delivery, electric automobiles, and dark stores. 

Despite increased competition from fast commerce and online platforms, organised food and grocery shops in India might see a revenue rise of 14-15% in fiscal year 2025. The industry is flourishing and has repeatedly shown satisfactory performance, with growth of 30% in FY23 and an expected 15% in the current financial year.

Biggest retailers in India 

Below are some of the retailers in the supermarket industry in India as of March 7, 2024.

CompanyMarket cap (₹ cr.)Total revenue in FY2023 (₹ cr.)Share price % returns (1Y) as of March 7, 2024
Osia Hyper Retail 386.27743.5115.65
Future Retail119.306,560.87 (FY21)-22.81
Avenue Supermarts2,55,47442,968.9014.22
Spencers Retail957.202,485.1673.25

Also read: Exploring India’s cloud kitchen landscape: Trends & forecasts


The food retail industry in India is poised for explosive growth, fueled by rapid urbanisation, increasing disposable incomes, and evolving consumer preferences. 

With major players like Avenue Supermarts and Spencers Retail leading the charge and trends like quick commerce and D2C models reshaping the landscape, investors have a significant opportunity to capitalise on this emerging sector.

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StockGro Team

StockGro is India’s first and largest ‘Social Investment’ platform aimed at helping you master the art of “Trading & Investment”. Trade, Invest and get rewarded to Learn everything about ‘Investments’ the fun-filled way.

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