Indian consumers are increasingly gravitating toward premium products, with premium smartphones priced above ₹30,000 now accounting for 26% of all phones sold in India, up from 20% in 2020. According to Kotak Mutual Fund's report titled 'The Great Consumption Shift,' this shift indicates a clear preference for higher-value purchases despite largely flat overall smartphone volumes. The report also highlights Apple's remarkable growth trajectory in India, with the company's revenue projected to reach ₹1.43 lakh crore in FY26, more than double the revenue of Hindustan Unilever Ltd despite serving a much smaller customer base. Apple's India revenue has grown 47% CAGR over FY19-24, significantly outpacing traditional FMCG companies' growth rates.
The live events sector has experienced remarkable expansion, with ticketed live events increasing from approximately 19,000 in 2022 to 34,000 by 2025. As reported by Kotak Mutual Fund, this industry is now valued at ₹20,861 crore and continues to show robust growth. Digital platforms, OTT subscriptions, and e-commerce have demonstrated exceptional revenue growth that has far surpassed traditional consumption sectors such as FMCG, air conditioners, refrigerators, hotels, and domestic tourism. The report notes that OTT paid subscribers grew at a 40% CAGR between FY19 and FY26, while the hearables market expanded at a 52% CAGR. These newer categories have reached maturity or experienced slower growth, while spending in digital services has dramatically increased.
Foreign travel spending has risen 450% over the past eight years, reaching approximately ₹1.45 lakh crore in FY26 up to February, making it larger than the country's entire building material industry comprising plywood, tiles, pipes and laminates. According to the Kotak Mutual Fund report, this shift represents a fundamental change in how Indian households are reshaping their spending priorities. Overseas investments in equity and debt have risen 7.3 times over the last three years. The report concludes that India's wallet has shifted 'from cereal to data to OTT to mobiles,' with consumers increasingly prioritizing connectivity, convenience, experiences, premium products, and global exposure.
The consumption landscape is becoming increasingly unequal, with the wealthiest 10% of urban consumers spending several times the national average on jewellery, education, dining, healthcare, and consumer goods. As reported by Kotak Mutual Fund, income levels for wealthy urban households are estimated to increase by approximately 18% annually from FY20 to FY25, compared with around 6% for the broader urban mass market. The report notes that cereals' share in household spending fell from 22% to 5% in rural India and from 12% to 4% in urban India between 1999-00 and 2022-23. Additionally, affluent rural households are experiencing faster growth than rural non-agricultural labour segments, further concentrating consumption among higher-income segments.
Despite changing consumption patterns, household finances face mounting pressure from rising costs. According to the Kotak Mutual Fund report, urban rents have steadily risen as a share of household spending, while rental costs across major cities have surged over recent years. Household EMI burdens have often grown faster than income growth, with EMI obligations outpacing income growth in five of the past seven years. The report also highlights the growing impact of speculative trading and digital fraud on household finances. Retail traders lost ₹2.87 lakh crore cumulatively in the futures and options (F&O) segment between FY22 and FY25, with 91% of individuals losing money in FY25 alone. Digital fraud losses over the last six years amounted to nearly ₹53,000 crore, equivalent to the size of India's branded quick-service restaurant industry.
