EDITALK

2024 - The Tale of Samay of Bharat!

For the horological industry, the year 2024 has passed off in a fairly peaceful and versatile manner, though with some hiccups along the way, in both its up and down swings, that came about, akin to the movement of a see-saw. For the world in general, the year was no great guns, but for India and its horological industry, the last quarter of this calendar year which also coincides with the third quarter of the Indian Financial Year 2024-2025, seems to be looking pretty good, for both wristwatches and wall clocks. The Festival Season this year which was anxiously awaited both by the brands as well as the trade, turned out to be better than the past some months. This Festival Season in India, has witnessed a notable surge in the purchase of watches, clocks as well as other lifestyle products, as shoppers brought these festivals in, with elegance and sophistication. This definitely augurs well for the horological industry. Trade channels have attributed this growth in demand to affordable prices that brands offered in the way of various schemes and new introductions, as well as the rise in average spending power and capacity. Also, as a direct result and impact of this growth in demand, even the manufacturers and suppliers of ancillaries or those engaged in providing services to this industry such as plating and surface enhancement, got helped as hopefully new orders would have hopefully started coming in. Although the going was good even for mass-market and mid-priced products be they wristwatches or clocks, it was however, the premium and luxury segment of watches that indeed witnessed a strong growth, as a considerable rise was observed in the sales of watches priced in the higher bracket. Premium, luxury and limited-edition watches are another hot favourite this season. Commenting on this aspect, Ashok Goel who runs 'Luxury Time' remarked, "We have already observed a 10% to 12% uptick in demand for luxury watches since the beginning of the festive season. We expect this demand to be in the range of 12% - 15% higher as we move deeper into the festive and wedding season. Watches in the range of Rs. 1 to Rs. 5 lakh are seeing good sales." As off today, the Indian Watch Market on the whole, is projected to register a CAGR of 20.32% between 2024 and 2029. The disposability and affordability of watch brands make them a popular fashion choice among consumers across the country. Lower priced and mid-priced watches and clocks are also increasingly gaining market traction due to increasing demand for 'value-for-product' watches, clocks and other life-style accessories among Indians. So, considering how the tail end of this calendar year is passing until now for our industry, hopes for the future in terms of the New Calendar Year to follow, as well as the fourth and last quarter of the Indian Fiscal, look fairly positive and remain bright. While the watch & clock brands continue to roll out new and innovative models, the trade channels too are optimistic about the months to follow. However, all this said and done, the one hurdle that's in a way likely to deflate the ongoing optimism of brands as well as trade, is the change in GST rate slabs, under consideration by the Finance Ministry, which looks to be planning to move some products beyond a particular price point from the present 18% to the higher slab of 28%. If this actually happens, then high-end, premium and luxury watches from a certain price point and onwards are quite likely to suffer, as the consumers who usually go in for such premium products, will then be reluctant to take on-spot buying decisions. After all, a jump by 10% from 18% to 28% is not an easy rise for even such consumers who wish to buy premium products, to willingly and happily accept and absorb. Hence, it will indeed be in the fitness of things, if the Government in all its prudence exercises its ability and discipline by the use of reason and rethinks the whole issue all over again by finding a middle-way out of any such situation arising in future, which turns into a hurdle and consequently, arrests the present trend of more and more consumers with disposable income to spare, wanting to splurge on such products. The way out, therefore, is to bring an amicable solution to this problem and adopt the principle - "Live and Let Live." By increasing GST tariff slabs for a certain price-point and above, will only arrest the resilience demonstrated in recent times by Indian watch & clock customers into going in for more premium products and prevent them from taking buying decisions, as well as can also indirectly result in encouraging the grey market.. Most of all, India's watch market is clearly heating up. Its domestic sales are continually growing in double digits, while growth in most other world regions is either flat or even down. Today, among the world's population of ultra-high-net-worth individuals, India is growing far more rapidly than any other country. Moreover, among 'aspirational consumers' which account for about 50% of all premium sales, the population of India is expected to touch a staggering 100 million heads by 2027, up 70% over that of 2023. It is primarily due to this reason, that many renowned global brands are now eyeing India as their next most promising business destination and wanting to entrench themselves here either on their own or through tie-ups with Indian firms. At the same time, this growth should not still us at all but instead it should also lead us all for a new avenue for future to come together in a united forum or body and make a road map, which works towards making our country a sourcing hub for the rest of the horological world. Furthermore, it is also worth mentioning that the upcoming Maha Kumbh Mela (Fair), held once every 12 years, and scheduled to be held in Prayagraj (Earler known as Allahabad) from January 13 to February 26 2025, is expected to be yet another milestone in the promotion of many Indian products, including horological time-telling devices. This, together with the ongoing wedding season in India as well as the soon to follow Christmas Festival and New Year celebrations, are bound to act as drivers of good business for horological products. It will not only be good for the brands and the trade, but it will be equally good for the manufacturers and suppliers of ancillary products to the watch and clock industry as well. In short, it will be like a Win-Win situation for everyone engaged in horological activity. Last but not least, an equally large and huge boost, to the horological industry and trade will also come from the upcoming India International Watch & Clock Fair - Samaya Bharati 2025, being held shortly from January 16 to 19, in the Country's Capital New Delhi. So, as 2024 comes to a close, let's all keep our fingers crossed, and hope for the best in the New Year to follow with a flourishing Future and Celebrate the Tail-End of this year as the Samay of Bharat!

Hemal M. Kharod