India’s First Ikea Store Opens Up In The Outskirts Of Hyderabad

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New Delhi: To bring inexpensive Nordic-inspired furnishings and food to the world’s fastest-growing middle class, India’s first Ikea store will open on Thursday. This seems to be a milestone that’s been in the making more than a decade.

Ikea expects to welcome as many as 6 million visitors a year to its 13-acre complex in Hitec City, on the outskirts of Hyderabad, India’s fourth-biggest city. The 400,000-square-foot showroom contains some 7,500 products, of which about 1,000 will sell for less than 200 rupees ($2.91) apiece. It’s the first of 25 stores Ikea plans to open across the nation by 2025.

Ikea’s launch comes at least 12 years after it started studying India, which is poised to overtake the US to become the world’s second-largest middle-class market by 2022. By then, sales of homewares and home furnishings will probably reach $15.3 billion from $12.9 billion last year, according to researcher Euromonitor International.

“Rising incomes and affluence make for an attractive market in India,” said Sowmya Adiraju, a research analyst with Euromonitor in Bengaluru, in an email. “Indian consumers are curious to see what Ikea has to offer and the retailer is well-positioned to meet this demand.”

The world’s biggest furniture retailer invested more than 10 billion rupees on its first foray in India. It’s counting on new customers in industrializing nations bolstering sales growth in the face of brand fatigue and increased competition from online retailers, such as Amazon.com Inc. and made.com, in established markets. Ikea added no new outlets last year in Sweden, where domestic sales were flat.

“We know that we are bravely stepping into a low-price zone,” Jesper Brodin, Ikea Group’s chief executive officer, told reporters on Wednesday. “We are prepared to take some risk in India.”

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