The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has forecasted that the Indian watch industry will grow to be worth Rs. 15,000 crore (£150m) by 2020, three times its current market worth of Rs. 5,000 crore (£50m).
ASSOCHAM says this is due to the emerging middle class in India and the growing number of high-net-worth individuals.
The forecasts follow the finding of a recent study that ASSOCHAM’s secretary general D S Rawat said will be driven by youth and premium consumers.
"The average growth in the size of the market is slated to be around 15-20 percent per year," explained Rawat, who added that there is "enormous potential" for growth of the industry in this untapped youth segment.
"Some customers look out for features like fashion appeal, technology, sophistication and status. Others go for durability, economy and precision. Many customers prefer mechanical and automatic watches, while others prefer quartz watches," he said.
The ladies watch market is also said to be on the rise, while children’s watches are also a growing area.
The report also highlighted that watches retailing for about Rs. 500 to Rs. 5000 (£5 to £60) were the bestsellers, while watch sales in the £60 to £290 price bracket are said to be growing at „an exponential rate of more than 25%“.
The report said that an increase in international travel has meant Indian consumers are more aware of the various global watch brands, while more international and Swiss made watch brands are opening standalone stores in the country.
However local players still continue to dominate the Indian watch industry due to good manufacturing base and price points at which watches are retailed.
"Collaborations, right planning and joint ventures in marketing hold the key to success for both domestic and International watch manufacturers", added Rawat.
The figures reveal that male watch buyers far outnumber female shoppers, accounting for around 65% of sales, while students are the largest segment of buyers accounting for approximately 30% of the sales.
Tissot has emerged as the largest selling Swiss brand in India. It is estimated that Tissot’s volume sales during 2010 in India crossed 50,000 watches with average retail price recovery of Rs 15,000 per watch (£175).
In terms of volume TAG Heuer and Raymond Weil are also said to have become popular.
In terms of volumes, the organised players – that is, those watch brands sold through official retailers and proper distribution channels – currently command 40% of the industry while the remaining 60% is driven by the unorganised segment, which consists of smuggled watches, cheap imported watches and those assembled by small unorganised companies.
"For most of the international watch brands, India is one of the top priority markets in the world. Companies are looking for an alternative to China to set up their manufacturing base and the government can play a vital role to make India the next destination", said the report.