India's online food delivery market is growing at 18 percent annually and is expected to cross Rs 2 lakh crore by 2030, according to a report by IPO- bound Swiggy and management consulting firm Bain.
The food services market in India, which encompasses dining out and ordering in, is currently valued at Rs 5.5 lakh crore, said the report. The market is poised to grow at 10-12% annually over the next seven years, reaching Rs 9-10 lakh crore by 2030.
However, the average spend per order will only slightly increase from Rs 220-240 in CY23 to Rs 230 to Rs 250 in CY30.
This growth trajectory will be driven by robust fundamentals, including an expanding customer base, increasing consumption occasions, and a rise in supply. Additionally, online food delivery is expected to grow faster at around an 18 percent CAGR, contributing 20 percent to the overall food services market by 2030, according to the report.
"For instance, China has four times the number of restaurants per million urban population, as compared to India. This study highlights this headroom and suggests that the Indian food service market catering to middle- and higher-income segments wvill expand from Rs 4-5 lakh crore at present, to about Rs 10 lakh crore by 2030," Rohit Kapoor, CEO, Food Marketplace, Swiggy said.
"As we look toward the next decade, with an estimated growth rate of 10-12 percent annually, exciting opportunities loom on both the demand and supply fronts. By 2030, the market is poised to serve an additional 110 million customers, gradually shifting eating out from a special event into a convenient lifestyle," said Navneet Chahal, Partner and co-author of the report.
The report said that the addressable customer base for the Indian food services market is expected to expand by 110 million, growing from the current 320-340 million to approximately 430- 450 million by 2030. This surge will be supported by macroeconomic tailwinds including rapid urbanisation and a rise in affluence.
The report highlighted that eating out is a special event for Indian consumers, occurring an average of 5 times per month, and this frequency is expected to increase to 7-8 times by 2030. This gradual shift will point to a transition in the way eating out will be perceived, moving from special occasions to a matter of convenience, with new occasions (e. g., mid-meal dayparts) and greater access (expansion of organized supply, food delivery growth).
A trend that mirrors developed markets like the US and China, where eating out is convenience-led and the monthly eating out frequency is 25-30, thus indicating massive headroom to drive new occasions in India.
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