India's Rank in World GDP

Growth Projections 30% 135% 10.7%

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1991 1995 2000-2005 2010-2015 201820192020 2021P-2022P2025P
BI Nominal GDP (USD billions)

Considers Fx rate at 1 USD=INR 75
White boxes at the top refer to India’s GDP rank on a global basis, All Years on the chart are financial years

CONSUMPTION-DRIVEN ECONOMY

India’s economy is primarily consumption-driven and India’s share of domestic consumption, measured as private final
consumption expenditure, to its GDP was ~60.5% in financial year 2020, as compared to 39.24% for China. India’s high share
of private consumption to its GDP has the advantage of insulating India’s economy from any volatility in the global economy.
As a result, sustainable economic growth in India directly translates into sustained consumer demand for goods and services.

The outbreak of the COVID-19 pandemic led to a depression in demand with an estimated loss of revenue in merchandise retail
worth US$ 117 billion in financial year 2021. With the uncertain economic environment, not only are consumers more
thoughtful about their consumption but also more conscious of their savings and investments. Consumption priorities are also
driven by health and safety concerns and the other behavioral changes caused due to the outbreak of the COVID-19 pandemic.
While discretionary categories like apparel and lifestyle have been severely impacted by the COVID-19 pandemic, need based
categories like food and pharmaceutical have witnessed growth in the last financial year.

In financial year 2019, private final consumption expenditure (“PFCE”) accounted for ~59% of India’s GDP, as compared to
~39% for China, and ~68% for the United States for similar period. The table below sets out the PFCE for Indian households
since financial year 1991 and estimated up to financial year 2025, including growth projections after factoring loss in PRCE
due to the outbreak of the COVID-19 pandemic. All values in the chart below are in USD billions.

CAGR: 12.8% (1991-2020) ~

1991 2005, 2010 2015 2016 2017 2018 2019 2020 2021P 2025P
m PFCE

Source: Technopak Research, RBI Data; Year indicates financial year

CONSUMPTION TRENDS

The retail market in India was valued at USD 796 billion in financial year 2020, and is expected to grow at a CAGR of 6.23%,
and be valued at USD 1,077 billion by financial year 2025. India’s retail basket accounted for approximately 48.5% of its
private consumption in financial year 2020, with the pharmacy and wellness category accounting for approximately 2.9% of
India’s retail market. Penetration of organized retail (which includes organized Brick and Mortar stores as well as E-commerce)
in pharmacy and wellness category was approximately 10% in financial year 2020, and expected to increase to approximately
20% by financial year 2025, implying a CAGR of 25% between financial year 2020 and financial year 2025. The table below
sets out the size of retail market and the penetration of organized retail across different categories as of financial year 2020, and
the expected growth rates of various categories as of financial year 2025.

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