What makes “childhood” so memorable? Well, for most of us, it is the games we played as children, and of course our favourite toys.
Toys have undoubtedly been a significant part of our childhoods. Irrespective of the generation or financial status, we have all played with toys of some kind or other. But do you know that there is a whole industry behind these colourful toys, contributing to the country’s growth?
You read that right! The industry is more than just fun toys. Read further to understand how they impact the Indian economy.
What does the toy industry include?
The toy industry includes all companies and unorganised set-ups manufacturing and selling toys and related products.
Toys comprise objects that look like miniatures of someone or something.
Everything from soft toys to board games, plastic toys on carts to smart toys connected to our phones, comes under the toy industry in India.
History of the toy industry in India
Toys have been in existence since the beginning of mankind, but not necessarily in the same form. Hundreds and thousands of years ago, people still played with toys made using natural products like leaves, stones, tree twigs, stems, etc.
The reference to a board game similar to ludo can be seen in the Hindu epic, Mahabharat.
The growth of toy manufacturing companies in India
The toy sector during the 1900s mainly consisted of traditional toys like rattles for babies, puppet toys made of clothes, homemade plush toys, dolls made of clay and wood, board games, etc.
The number of popular brands in the toy industry was quite low, as most toys were manufactured in the unorganised sector. With policies of liberalisation, privatisation and globalisation coming in 1991, the doors for toy imports opened widely. Until a few years ago, the toy industry in India was dominated by imports from China, given the low cost of products.
Indian toy industry today
From heavy reliance on imports to becoming one of the significant contributors to India’s exports, the toy industry has come a long way. A big part of this growth is credited to the Make in India Movement. Today, there are several branded toy companies in India manufacturing toys under varied categories.
Impact of the Make in India Movement
Make in India was an initiative launched in September 2014 by the Indian government, under the guidance of Prime Minister Narendra Modi.
As the term suggests, its objective was to increase the production of different products within the country rather than relying on imports. The aim was to make India a global market and an export-dominant country.
True to the vision, the toy sector has benefitted from this initiative and has increased its performance to increase exports and cut down on imports.
The toy industry saw a decrease of 70% in imports from $371 million in 2018-19 to $110 million in 2021-22. On the other hand, exports have increased by over 60% for the same period from $202 million to $326 million.
Economics of the toy industry
- The current market size of the toy market in India is $1.5 billion and is expected to reach $3 billion by 2028 with a CAGR of 12%.
- India is the second-largest producer of polyester and related fibres, contributing 8% of the global share of plush toys.
- The government has set up over 60 toy facilities to encourage manufacturing within the country. 400-acre cluster in Koppal, Karnataka and 100-acre in Uttar Pradesh are among the popular ones.
- According to the free trade agreement with the UAE and the Middle East, Indian toys will have zero-duty market access.
- The government issued Toy Quality Control Order in 2021, to ensure safety and quality standards in manufacturing toys. As of February 2023, over 1,000 local manufacturers and close to 30 foreign manufacturers were granted licences to manufacture toys in India.
Trends in the toy industry
- STEM toys – STEM stands for science, technology, engineering and math. These toys focus on providing knowledge with fun to kids. STEM toys are one of the recent and most popular trends, impressing a large group of parents as they make education fun and light.
- Rise in online marketplaces – Buying toys is only a click away today. Various e-commerce websites like Amazon and Flipkart list high-quality branded toys with premium facilities like one-day delivery.
- Connected toys – One of the many gifts of the Internet of Things (IoT) is connected toys. These toys connect to the internet with built-in features like Wi-fi and Bluetooth.
- Quality standards – The mandate of licence and quality standard requirements have increased the confidence of consumers, resulting in increased demand for toys and related products.
- Holding to our roots – The ill effects of increased modernisation have led people to go back to their roots. Parents are now focussing on introducing traditional and value-based toys to their children over online gaming applications.
|Percentage in the market
|Outdoor and sports toys
|Infant and preschool toys
|Games and puzzles
Source: Invest India
Top toy companies in India
Though India has numerous companies manufacturing toys, the number of companies listed on the Indian stock exchanges is less.
Below are some famous brands selling toys in India.
Founded in 1987, Funskool is a collaboration between MRF and Hasbro, an American toy manufacturing brand. It develops over 60 new toy products each year.
MRF is listed on the National Stock Exchange and Bombay Stock Exchange with a share price of ₹1,20,500 and ₹1,20,460.70, respectively. (As of 14 Dec 2023).
Hasbro is listed on NASDAQ with a share price of $46.80 (As of 14 Dec 2023).
A family-owned business in Denmark, Lego has a presence across various countries. It entered Indian markets in 2020 with the slogan “The Little Red Brick”, indicating unlimited creative potential in children. Today, Lego is a household name in many countries, including India.
Founded in 1945, Mattel entered the Indian markets in the 1980s. Whether Indians know the company or not, its products Barbie and Hotwheels have been popular in numerous homes.
Some top Indian brands manufacturing toys are Brainsmith, Buddyz, Clever Cubes, Cocomoco Kids, etc. Apart from toy manufacturers in India, there are popular toy stores like the privately owned RCS (Ram Chander and Sons) in Delhi and Reliance-owned Hamleys.
The Indian toy industry has grown from an import-dominant sector to a self-reliant one, contributing immensely to the country’s export trades. As of today, India’s share in the global toy market is less than 1%. However, the opportunities and government incentive schemes show promising growth for Indian toys.