April 2024

Connecting Commerce

CMS CONSUMPTION REPORT 2024

Unfolding
India's
Consumption
Story
Section 1

The optimal tailwinds for India

India is on the cusp of a tremendous opportunity for both economic progress and improvement in the
general wellbeing of its citizens. Having emerged as the 5th largest economy in the world, India’s
ascent as a global economic powerhouse is underscored by its resilience, innovation, and
commitment to economic reforms. In recent years, India's economy has surged, recording a growth
rate of 8.4% in December 20231 quarter, while outpacing many major economies, a momentum that
is expected to sustain over the next decade. While there are multiple factors at play, two integral
components that are acting as strong tailwinds for India’s growth are the formalization of the
economy and increased consumption.

Formalization: Integral to India’s growth narrative are domestic economic drivers such as enabling
reforms, exemplified by initiatives such as the Goods and Services Tax (GST) – measures which have
been instrumental in streamlining business processes and fostering an environment conducive to
investment and growth. Moreover, India's demographic dividend, characterized by a youthful and
dynamic population, serves as a catalyst for productivity and innovation. This demographic
advantage bodes well for sustained economic expansion, positioning India as a key contributor to
global growth.

Consumption: Domestic consumption, which powers ~60% of GDP2 today, is expected to grow into
a USD 4 trillion opportunity by 20303. This consumption growth will be supported by a 1.4 billion
strong population that is younger than any other major economy. The vision for the future of
consumption in India is anchored in the growth of the upper-middle income and high-income
segments, which will grow from 1 in 4 households today to 1 in 2 households by 20304. Household
savings have historically been high as thrifty and cautious Indian families put away more than a 5th of
their incomes for a rainy day. This buffer provides support to domestic consumption expenditure
even through challenging cycles in economic activity.

As India continues to evolve and contribute to global progress,

while striving to ascend to the position of the 3rd largest
global economy by 20275, its enviable growth story is being
optimally enabled by the consumption sector.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 1
A tale of co-existence
India has leapfrogged generations of technologies. The current digital transformation journey has
been instrumental in fostering inclusion and enhancing quality of life with initiatives like Aadhaar,
Unified Payments Interface (UPI), and widespread internet penetration laying the foundation for
Digital India and enabling solutions for societal challenges using technology. Mobile-based payment
models have acquired greater acceptance in a shorter time than credit cards did over the past 2
decades. Even as India is poised in the midst of a high growth trajectory, one of the major propellers
behind this resilient narrative will be a thriving financial ecosystem integrating the 2 key components
– cash and digital payments.

While UPI was launched in 2016 (FY17) to promote digital payment transactions, Currency in
Circulation (CiC) has increased from ~` 13.35 trillion in FY17 to ~` 35 trillion in FY246, a nearly 3X
growth in 7 years. The steady rise in CiC, at 15% CAGR (FY17 – FY24), reflects a strong economic
performance and signals a boom cycle.

CMS Cash Index™ (CCI) vs. HSBC India Composite Purchasing

Managers Index (HSBC ICPMI)
The CMS Cash Index™ (CCI) is a weighted index consisting of two factors; the cash that goes into
circulation via the ATM channels as replenishment and the cash collected from the organized retail
channels post-consumer purchases. The HSBC India Composite PMI (HSBC ICPMI), erstwhile S&P
Global India Composite PMI, gauges the vibrancy of the economy through the expansion and
contraction in economic activity. The CCI™ and the HSBC ICPMI have been exhibiting a strong
correlation since April 2016 while indicating how cash usage is closely linked to economic growth and
consumption in a country.

In the last 8 years, the CMS Cash Index™ (CCI) has proven to be a very powerful indicator to track
commerce transactions by consumers and has been referred to by various policymakers as well.

Exhibit 1: CCITM vs the HSBC India Composite PMI

140.0
CCITM
HSBC India
120.0
Composite PMI

100.0

80.0

60.0

40.0

20.0

0.0
Apr-16
Aug-16
Dec-16
Apr-17
Aug-17
Dec-17
Apr-18
Aug-18
Dec-18
Apr-19
Aug-19
Dec-19
Apr-20
Aug-20
Dec-20
Apr-21
Aug-21
Dec-21
Apr-22
Aug-22
Dec-22
Apr-23
Aug-23
Dec-23

Mar-24

Source: CMS Info Systems & S&P Global

Note: The HSBC ICPMI readings are rebased to 100 in April 2016, when the CCI™ was launched, to derive the correlations between the two indices.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 2
A global lens
The 8 major global economies, including the United States (US), China, Japan, Russia, India, United
Kingdom (UK), Brazil, and South Africa, highlight a noteworthy picture of CiC as a percentage of
their GDP. Smaller economies like Brazil, South Africa, Russia, and the UK had much lower volumes
of CiC, when compared to the larger economies like the US, China, Japan, and India, thereby
indicating the direct correlation between CiC and the size of the economy.

Exhibit 2: CiC as a percentage of GDP for select global economies

25

Brazil
20 China
India
Japan
15 Russia
South Africa
United Kingdom
10
United States

0
CY 2013 CY 2014 CY 2015 CY 2016 CY 2017 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022

Source: BIS CPMI Red Book Statistics

Note: Data for Russia is not available beyond 2020.

For an economy to flourish, it is imperative that the

payments ecosystem allows all modes of transactions. Cash
payments are an indispensable complement to
mobile, electronic, and other forms of digital payments. This
balance is especially vital for a consumption-driven economy
like India, where the ability to spend influences overall economic
health.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 3
Section 2

What are Indians consuming the most?

As India ascends the ranks to become a global powerhouse and achieve economic heft, its people will
inevitably benefit from its growth - becoming more affluent and moving up the income and
consumption ladder. With affluence growing and more people moving from the bottom of the
income pyramid to the middle of the pyramid, consumption will accelerate with an increasing number
of consumption class Indians focusing on both savings as well as spending.

Exhibit 3: Top 5 retail sectors with high growth in consumption

1 1
MEDIA &
PETROLEUM
ENTERTAINMENT

2 2

FY23 MEDIA &

ENTERTAINMENT
FY24 FMCG

3 3

RAILWAY RAILWAY

4 4
5 5
FOOTWEAR DURABLES
AVIATION AVIATION

Source: CMS Info Systems

Key consumption trends of FY24

1 2 3 4
Entertainment Indians moving Rise of the travel Winds of change
is no longer a ‘luxury’ beyond the ‘roti, kapda, economy
Post the COVID-19
The Media & makaan’ paradigm Indian consumers are pandemic, e-commerce
Entertainment (M&E) With India crossing the spending on travel as spending had witnessed
sector in India not only USD 2000 GDP/capita exemplified by the growth a dip. However, it is
has a long history but mark, Indians are moving in the Aviation and Railway expected that the
has metamorphosed into beyond necessities and sectors. The proliferation e-commerce sector, along
a new-age, omni-channel, spending more on both of rising affluents and with other formats of
and vast industry that discretionary as well as increased mobility are consumption, will witness
optimally caters to the non-discretionary goods engendering an economy growth as Indians continue
nuanced growing with FMCG taking the lead where individuals are to consume more.
consumption needs of in non-discretionary increasingly spending on Similarly, recognizing the
the Indian audience. spending. travel. role of Education in
improving employability
and wealth, it is expected
that spending in the sector
will remain robust.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 4
 1 Entertainment is no longer a ‘luxury’
There was an era when entertainment meant waiting for the Sunday evening movie on
Doordarshan. This was also a time when it was not common to have a television set in every
household and people often converged in one house to watch television. Entertainment was
almost a ‘luxury’ then. Those times are in the past with the industry witnessing a rapid evolution
from community viewing to multiple viewing platforms giving consumers access to on-demand
entertainment that is available on the palm of their hands through a simple click or a flip. The
Indian Media & Entertainment (M&E) sector grew by 8% in 2023 to reach ` 2.3 trillion with
estimates suggesting that the sector will grow by another ~` 762 billion to reach ` 3.1 trillion by
20267.

The growth in this sector is being fuelled by increasing spends

as Indians allocate a higher portion of their household budgets
to M&E, especially post the COVID-19 pandemic. As per Retail
Consumption Trends by CMS, average spending towards M&E
Media & increased by 29.30% in FY24. It recorded the highest annual
growth across 20+ consumption sectors in India. Over a 2-year
Entertainment period (FY22 – FY24), average spending on M&E has increased
by nearly 100%. While cinema continues to fuel entertainment
experience in India, niche OTT platforms and curated content are
Growth in the new-age segments of growth. Consumers are willing to pay for
differentiated content that resonates with them. This is also
average spending evident in the growth of subscription models with an increasing
in FY24 number of consumers choosing to subscribe for content.

Exhibit 4: Expected growth in M&E across segments

Segment growth 2023 to 2026E

` Billion Positive Subtotal

800 12 5 762
28 13
55 41
700
69
600 71
500 167

400
301
300

200

100

0
Digital Online Animation Television Live Films Print OOH Music Radio M&E
gaming and VFX Events Sector

Source: FICCI-EY Report 2024

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 5
 2 Indians moving beyond the
‘roti, kapda, makaan’ paradigm
Easing inflation and rising consumer demand coupled with a narrowing of the urban-rural
divide is fuelling growth in FMCG and Consumer Durables. For the first time in 2023, the
consumption gap between urban and rural markets has narrowed down, with rural areas
witnessing a commendable 5.8% growth, closely approaching the urban growth rate of 6.8%8.

The Indian FMCG market was valued at USD 164 billion in 2023 and is expected to reach USD
1093.06 billion by 2032, growing at a CAGR of 21.61% during the forecast period (2023 – 2032)9.
The sector plays a critical role in boosting economic activity as it employs around 3 million
people accounting for approximately 5% of the total factory employment in India10.

Increased consumption spending in FY24 endorses the growth

trend. As per Retail Consumption Trends by CMS, average
spending in the FMCG sector increased by a robust 16.76% in
FMCG FY24 with a remarkable consumption recovery after witnessing a
decline of 21.94% in FY23. Additionally, there was an increase in
average spending on Consumer Durables too, with FY24
witnessing an increase of 3.74% in the wake of a 7.64% decline in
Growth in average spending in FY23.
spending in FY24

Exhibit 5: FMCG companies expected to witness robust topline growth

FMCG Revenue Growth (YoY%)

Average 10 year growth Growth

20

14
15
11.8 11.9 11.9 11.2 11.1

10 9

5
5 4
3 3

0
FY16

FY17

FY18

FY19

FY20

FY21

FY22

FY23

FY24e

FY25e

FY26e

Source: AceEquity, Antique

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 6
 3 Rise of the travel economy
The proliferation of millennials and rising per capita incomes are engendering a travel economy
in India with Indians eschewing the consumption of goods in favor of experiences that can
range from travel and leisure to fine dining. It has been observed that the overall services
category has grown 1.4X times the product category in the consumer’s consumption basket.
Further, the goods category has grown at a CAGR of 8-9% in the period FY18 to FY23 while the
services category has grown at a CAGR of ~11-13% in the same period11.

Within the larger travel economy segment, significant money is being spent in the aviation and
railway sectors.

Flying high: Average spending in the Aviation sector witnessed slow

annual growth of 6.36% in FY24 compared to a 19.81% growth in
FY23. In the 2-year period (FY22 – FY24), average spending in the
sector has increased by 27.42%. The increase in air travel is
exemplified by the sharp growth in passenger air traffic across the
Aviation major airports of the country. Since February 2023, passenger air
traffic in India has witnessed a steady growth reaching a peak of ~33
million passengers in December 202312. Presently, there are 148
Growth in average airports operational in the country, positioning India as the
third-largest domestic aviation market globally in terms of seat
spending in FY24 capacity. The government aims to further increase this to 220 by
FY25.

Exhibit 6: Passenger airport traffic

Mn

40
34 33
32 31
31 31 30 30 30 31
29 30
30

20

10

0
Feb'23 Mar'23 Apr'23 May'23 Jun'23 Jul'23 Aug'23 Sep'23 Oct'23 Nov'23 Dec'23 Jan'24

Source: CEIC data

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 7
 On the right track: Indians are increasingly spending on travel with both air travel and rail travel
benefiting from this increase in spends.

During FY24, average spending in the Railway sector witnessed

Railways
an annual growth of 8.16%. In the 2-year period (FY22 – FY24),
average spending in the sector increased by 56.35%.

Growth in average
spending in FY24

Inarguably, growth has been propelled by both freight as well as passenger traffic with the
number of passengers patronizing Indian Railways increasing sharply post the COVID-19
pandemic to reach 6.44 billion in FY23 as compared to 3.54 billion in FY2213.

Exhibit 7: Traffic trends in Indian Railways (2016 - 2023) (Mn)

10000
8,151 8,287 8,438
8,219 8,112

7500 6,438

5000
3,547

2500 1,287 1416 1509

1102 1106 1160 1221 1208

0
FY16

FY17

FY18

FY19

FY20

FY21

FY22

FY23

Freight traffic Passenger traffic

Source: Indianinfrastructre.com

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 8
 4 Winds of change
Clicks gaining momentum: Post witnessing a sharp downturn in FY23, e-commerce is now in
recovery mode with the pace of fall slowing down. Increasingly, consumers are ‘clicking’ to
meet their consumption and lifestyle needs. According to estimates, e-commerce retail is
expected to witness a growth of 20-25% in the period 2018-2028 and reach a value of ~` 13
trillion14. The pervasive trend of Cash on Delivery (CoD) will give a further fillip to the growth of
e-commerce in India. As per a Frost & Sullivan report, CoD accounts for nearly 60% of all
e-commerce payments in India. A separate study by Nielsen found that CoD was the favored
method of payment for over 80% of Indians with this going upto 90% in rural areas15. This
method of payment is more common in Tier-2 and Tier-3 cities as it is seen to be more secure
and convenient. Further, it also addresses the trust deficit in online transactions that is often
experienced by consumers.

While spending on the e-commerce sector has been on a decline, the pace of decline has been
slowing down. In FY23 average spending declined by 25.44% while in FY24, it declined by
14.61%, thereby indicating a strong recovery in the sector on same store basis.

There are 2 key factors that are acting as tailwinds for the growth of retail e-commerce:

Driven by Improved access

growing aspirations and affordability

Increased exposure to consumerism beyond Deeper internet penetration, stronger

local markets, Tier 2 & 3 cities have witnessed technology adoption and data access have
income and spending growing at a sharp clip. In given thrust to the e-commerce segment. The
2022, these cities accounted for over 60% of the cost of mobile data in India is one of the
total e-commerce orders, outpacing Tier-1 cheapest in the world with 1 GB of data costing
markets. Tier-3 cities experienced a 65% order around ` 13. With mobile data becoming
volume growth, Tier-2 cities witnessed a 50% cheaper, India has seen an almost 115X increase
growth, while Tier-1 cities saw only 10% growth16. in data consumption per user per month in the
2016-202217 period.

Exhibit 8: Growth in e-commerce retail

15
13

10
Value in ` Trillion

5.2
5

1.8

CY 2018 CY 2023 CY 2028

Source: BCG + RAI Report 2024

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 9
 Exhibit 9: Tailwinds for the e-commerce sector

~55% of Smartphone ~65% consumers

connections were base expected used CoD for their
in urban areas, to reach last online
of which 97% 1 billion by transaction.20
connections were 2026.19
wireless.18

The big ‘E’: Education will play a catalytic role in India’s growth ensuring that the country’s
demographic dividend does not become a demographic drain. Recognizing this, the
government has announced a host of programs to ensure that education reaches the depths of
our country, and the rural diaspora has access to both primary as well as secondary education.
The impact of such initiatives is becoming evident with a rise in the number of enrolments as
well as an increase in spending on education by Indian consumers.

While average spending on education declined by 1.61% in FY23, it was observed that in
FY24, average spending on the sector remained positively muted, thereby indicating a slight
recovery in expenditure.

Further, the higher education market in India has witnessed substantial growth, reaching USD
58.05 billion in 2023 and projected to reach USD 114.35 billion by 203221. Skill development and
employability are likely to be driven by the thrust on education.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 10
Section 3

Where are the high consumption hotspots of India?

0.90 0.82 1.21
1.12
Jammu & Kashmir Himachal Pradesh
1.50 1.48
1.40 1.39
Punjab
1.39 1.30
Uttarakhand
1.40 1.40
Assam
Haryana 1.33 1.18 1.22
1.20
1.82
1.49 Uttar Pradesh Bihar

Delhi

1.31 1.34

Rajasthan
1.48 1.39

1.27 1.29
Tripura

Gujarat 1.51 1.62

1.06
1.03 West Bengal

Madya Pradesh 1.23 1.28

1.21 1.25 Jharkhand

Maharashtra 1.49 1.56

1.58 1.61
1.16 1.18 Odisha
Chattisgarh
Goa
1.57 1.61
1.73 1.83
Andhra Pradesh
Annual average ATM withdrawals
Karnataka for spends (` Cr)
1.56
1.33
1.34 1.29
Tamil Nadu FY 2023 FY 2024
Kerala
YoY change in the annual average ATM withdrawals

-5% to -10% 0 to -5% 0 to 5% 5% to 10% 10% to 15% 15% to 20% >20% Source: CMS Info Systems

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 11
In FY24, 14 out of 23 States & Union Territories witnessed 6.45% YoY growth in the annual average
ATM withdrawal, and 9 States and Union Territories saw an average 4.14% YoY decline.

Exhibit 10: Average Cash Replenishment per ATM - State-wise (` Cr)

FY23 FY24
2.0

1.80

1.60

1.40

1.20

1.00

0.80

0.60
Andhra Pradesh

Assam

Bihar

Chattisgarh

Delhi

Goa

Gujarat

Haryana

Himachal Pradesh

Jammu & Kashmir

Jharkhand

Karnataka

Kerala

Madhya Pradesh

Maharashtra

Odisha

Punjab

Rajasthan

Tamil Nadu

Tripura

Uttarakhand

Uttar Pradesh

West Bengal
Source: CMS Info Systems

The consumption spillover

India is a vast country with a diverse population that is split across income, employability, education,
and cultural choices. India is also a nation that is currently on the move - per capita incomes are rising,
urban, semi-rural, and rural centres are thriving, and consumption is increasing across the country.

`1.43 Cr
This is evidenced by the 5.51%
growth in the monthly average ATM
`1.35 Cr 5.51%
cash withdrawals (used as a proxy
for consumption spends) which
increased to `1.43 crore in FY24
from `1.35 crore in FY23.

FY23 FY24

On a monthly basis, the average ATM cash withdrawals in FY24 were higher compared to FY23
with withdrawals in 10 out of 12 months exceeding the FY23 monthly average of 7.23%.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 12
Exhibit 11: Average Cash Replenishment per ATM - Month-wise (` Cr)
FY 23 FY 24

1.60

1.20

0.80

0.40
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Source: CMS Info Systems

While India’s consumption patterns are changing, as indicated by the contours of spending trends, we
are also seeing the emergence of consumption hotspots - regions and states in the country that are
leading on the consumption front. A deeper analysis of ATM cash withdrawals leads to the
emergence of two major consumption hotspots:

Consumption is reaching the grassroots 5 5 consumption hotpots

even as metros continue to hold sway of India

Consumption is reaching the grassroots even as metros

continue to hold sway
While metro cities continue to be a large contributor of India’s consumption spends, it is important to
highlight that spending is reaching the grassroots as well with both semi-metros and semi urban and
rural (SURU) amping up overall consumption spending. This is evolving as a long-term trend and is
also evident from the most recent Household Consumption and Expenditure Survey (HCES) 2022-23
which reflected that the gap between urban and rural consumption is reducing.

Exhibit 12: Average MPCE over different time periods

Sector 1999-’00 2004-05 2009-10 2011-12 2022-23

NSS (55th round) NSS (61st round) NSS (66th round) NSS (68th round)
Rural 486 579 1,054 1,430 3,773
Urban 855 1,105 1,984 2,630 6,459
Difference as 75.9 90.8 88.2 83.9 71.2
% of Rural MPCE

Source: Household Consumption and Expenditure Survey (HCES) 2022-23

Metros SURU Semi-metros ATM Withdrawal Trends by CMS indicate that in

FY24, average cash withdrawn increased by
10.37% in the metros, followed by a 3.94% increase
Growth in average cash withdrawn in FY24 in SURU, and a 3.73% increase in semi-metros.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 13
Exhibit 13: Average Cash Replenishment per ATM (` Cr) for Metro, Semi Metro,
and SURU
2.0
Metro Semi Metro SURU

1.5

1.0

0.5

0.0
Apr-22

May-22

Jun-22

Jul-22

Aug-22

Sep-22

Oct-22

Nov-22

Dec-22

Jan-23

Feb-23

Mar-23

Apr-23

May-23

Jun-23

Jul-23

Aug-23

Sep-23

Oct-23

Nov-23

Dec-23

Jan-24

Feb-24

Mar-24
Source: CMS Info Systems

Commensurate with FY24 average ATM cash replenishment trend compared to FY22, ATM cash
withdrawals in metro locations have grown at 37.49%, whereas SURU witnessed 12.50% growth in
ATM cash withdrawals.

Exhibit 14: Average Cash Replenishment per ATM (` Cr) for Metro, Semi Metro,
and SURU
2.0

Metro Semi Metro SURU

1.5

1.0

0.5

0.0
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Aug-22
Sep-22
Oct-22
Nov-22
Dec-22
Jan-23
Feb-23
Mar-23
Apr-23
May-23
Jun-23
Jul-23
Aug-23
Sep-23
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24

Source: CMS Info Systems

Taking cognizance of this trend, banks continue to maintain a good presence across metros,
semi-metros, and SURU. In the case of public sector banks, ~49% of the ATMs are located in
metropolitan and urban areas while ~51% of the ATMs are located in SURU. Correspondingly, in the
case of private sector banks, ~64% of the ATMs are located in metropolitan and urban areas while
~36% of the ATMs are located in SURU to enable consumption spending.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 14
5 hotspots of consumption spending

One must recognize that given how diverse and vast the Indian subcontinent is, both growth as well
as consumption are unlikely to be homogenous across the length and breadth of the country.
Inevitably, there are select states that will witness sharp economic and consumption growth while
there will be others that will lag on both fronts. State GDP, employment rates, and digital adoption
scores will hold sway in determining consumption levels.

ATM Withdrawal Trends by CMS demonstrate that spending in India is led by 2 Northern states,
2 Southern states, and 1 Eastern state. These include the Northern states of Delhi and Uttar Pradesh,
the Southern states of Tamil Nadu and Karnataka, and the Eastern state of West Bengal.

Exhibit 15: Top 5 consumption hotspots in ATM withdrawal

#1 #10
New
#3 Entrant
23.78 #1 9.12
11.45
22.30

Delhi Uttar Pradesh

#2
#5
#11
18.14 New
6.28 #4 Entrant
8.72
6.94

Karnataka #3
#2
15.77 West Bengal
17

Growth (FY23) (%)

Growth (FY24) (%)

Tamil Nadu
Source: CMS Info Systems

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 15
 Exhibit 16: 4 of the top 5 states consistently figure among the top 10 states with
highest state GDP

Projected GSDP (` Lakh Cr) Per Capita Net State Domestic Product
State and Rank
(FY24) (` Lakh) (FY23)

Maharashtra #1 38.79 2.24

Tamil Nadu #2 28.3 2.73

Gujarat #3 25.62 2.41

Karnataka #4 25 3.01

Uttar Pradesh #5 24.39 0.83

West Bengal #6 17.19 1.41

Rajasthan #7 15.7 1.56

Andhra Pradesh #8 14.49 2.19

Telangana #9 14 3.08

Madhya Pradesh #10 13.87 1.4

Source: Forbes India

In terms of absolute withdrawals per ATM, Karnataka saw the

highest annual average withdrawal of ` 1.83 Cr
during FY24, followed by Delhi and West
Bengal at ` 1.82 Cr and ` 1.62 Cr, respectively.

`1.83Cr `1.82Cr
`1.62Cr

Karnataka Delhi West Bengal

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 16
Section 4

Driving stronger consumption growth

With FY25 GDP growth forecast at 7%22 backed by strong government expenditure and domestic
consumption, the Indian consumption story is expected to play out strongly in the coming decade.
Within the larger retail consumption ecosystem, there are select sectors that are expected to witness
a sharper increase in spending and grow at an accelerated pace in FY25. These sectors include FMCG,
Aviation, and E-commerce. The growth in these sectors can be attributed to a confluence of factors
including increasing digitization, rising incomes, and the demand for customized and niche products
and services.

FMCG

Both, the value and volume in the sector is seen to be growing with the rural-urban
consumption divide narrowing. Spending in the sector sharply increased by 16.76% in
FY24 after witnessing a decline of 21.94% in FY23.

Aviation

The rise of the travel economy coupled with growing affluence is likely to give a sharp fillip
to the aviation sector. Spending in the sector increased by 6.36% in FY24 and by 27.42%
since FY22.

E-commerce

Consumption spending in e-commerce is increasing with digital formats of consumption

gaining traction by tapping hyper-local markets in India and growing aspirations. Rate of
decline in spending has reduced from -25.44% in FY23 to -14.61% in FY24.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 17
References

1. Data released by Ministry of Statistics and Programme Implementation on 29th February 2024

2. https://economictimes.indiatimes.com/news/economy/indicators/
indian-consumers-to-be-primary-divers-for-domestic-and-global-economy-barclays/articleshow/107109845.cms?from=mdr

3. https://www.business-standard.com/industry/news/
consumer-spending-in-india-to-exceed-4-trillion-by-2030-says-report-123081000582_1.html

4. https://www.business-standard.com/economy/news/
deloitte-projects-india-s-fy25-gdp-growth-at-6-6-as-exports-rebound-124042600361_1.html

5. https://www.businesstoday.in/latest/economy/story/
india-to-become-third-largest-economy-in-the-next-three-years-says-jefferies-in-a-note-418454-2024-02-22

6. https://rbi.org.in/Scripts/BS_CurrencyCirculationExtractDetails.aspx

7. https://www.ey.com/en_in/news/2024/03/
indian-m-e-sector-crossed-inr-2-point-3-trillion-in-2023-expected-to-reach-inr-3-point-1-trillion-by-2026-reveals-the-ficci-ey-report

8. https://nielseniq.com/global/en/insights/analysis/2024/indias-fmcg-market-remains-resilient-and-is-poised-for-growth-in-2024/

9. https://www.custommarketinsights.com/report/india-fmcg-market/

10. https://www.custommarketinsights.com/report/india-fmcg-market/

11. https://web-assets.bcg.com/36/1a/829b75f04b56b380a70b2dc7e50b/
unlocking-the-2tn-retail-opportunity-in-the-next-decade-rai-2024-na-digital.pdf

12. https://www.ceicdata.com/en/india/airport-authority-of-india-passenger-traffic/passenger-traffic-all-airports

13. https://indianinfrastructure.com/2023/08/22/key-statistics-trends-in-railway-traffic-and-earnings/
#:~:text=Rail%20passenger%20traffic%20in%20India,cent%20of%20pre%2Dpandemic%20levels.

14. https://web-assets.bcg.com/36/1a/829b75f04b56b380a70b2dc7e50b/
unlocking-the-2tn-retail-opportunity-in-the-next-decade-rai-2024-na-digital.pdf

15. https://toppandigital.com/translation-blog/end-finally-sight-indias-cash-delivery-habit/

16. https://www2.deloitte.com/content/dam/Deloitte/in/Documents/about-deloitte/in-ad-future-of-retail-noexp.pdf

17. TRAI

18. https://www.researchgate.net/publication/
373235014_The_Evolution_And_Impact_Of_E-Commerce#:~:text=India%20has%20seen%20a%20growth,of%20those%20connections
%20were%20wireless

19. https://www.financialexpress.com/business/
industry-indian-ecommerce-market-to-grow-to-325-billion-digital-economy-to-reach-800-billion-by-2030-3470164/

20. https://timesofindia.indiatimes.com/city/mumbai/
cash-on-delivery-remains-a-preferred-mode-of-payment-among-consumers/articleshow/107800864.cms

21. https://blitzindiamedia.com/india-higher-education-market-sector-overview/
#:~:text=Team%20Blitz%20India&text=The%20higher%20education%20market%20in,US%24%20114.35%20billion%20by%202032

22. https://www.thehindubusinessline.com/economy/rbi-retains-7-growth-forecast-for-fy25/
article68031362.ece#:~:text=The%20Reserve%20Bank%20on%20Friday,financial%20year%20beginning%20April%201.

CMS Info Systems Ltd. | Unfolding India's Consumption Story | April 2024 18
About CMS Cash Index™:
The CMS Cash Index™ was created by CMS Info Systems in 2016, to track the infusion of cash back
into the economy across various modes. Over time, this tracking of inflows and outflows of the
currency has become a valid measure of the commerce and economic health of India. The CMS Cash
Index™ is a weighted index consisting of two factors; the cash that goes into circulation via the ATM
channels as replenishment and the cash collected from the organised retail channels post-consumer
purchases, both covered by CMS Info Systems across cities and towns in India.

About CMS Info Systems’ Data & Analysis:

Retail Consumption Trends is a macroeconomic indicator of retail purchases based on the annual
average cash collected and processed per organized retail touchpoint across India. And ATM
Withdrawals Trends is consumer’s spending habit indicator based on annual average cash
replenished per ATM across India. CMS Info Systems today caters to 1,50,000+ business points,
where every 2nd ATM and every 3rd organised retail outlet in India is serviced by CMS Cash Logistics.

About CMS Info Systems:

CMS Info Systems Limited (BSE & NSE: CMSINFO) is India’s leading business services company
providing logistics and technology solutions to banks, financial institutions, organized retail, and
e-commerce companies with a presence across Cash Logistics, Managed Services, and Technology
Solutions. CMSINFO businesses include ATM and Retail Cash Management, Banking Automation,
ATM-as-a-service, AIoT Remote Monitoring, Software Solutions and Card Issuance, Management &
Personalization.

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Report does not contain, nor is it intended to constitute any legal, professional or policy advice, which you must undertake independently.
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