As global tensions rise and travel sentiment towards conflict-hit West Asia sours, Indian luxury retailers expect affluent consumers to increasingly shift their discretionary spending domestically.
The April-June quarter, usually a lean period due to fewer weddings and events that drive big-ticket purchases, could surprise on the upside after a strong March, the retailers said. Brands in luxury shoes, accessories, bags, and furniture are betting that curtailed overseas travel could keep more discretionary spending within the country.
This early momentum is already visible in sales at select luxury retailers. Italian bespoke shoe company Santoni’s India partner Luxerati Retail Pvt. Ltd’s co-founder Sanjay Kataria told Mint that their , which also include home goods brand Jay Strongwater, have seen a clear uptick in the last one month.
“March emerged as the strongest it has been in the last seven years, and sales rose strongly after a brief dip in February, with overall conversion ratios improving,” Kataria said. If the current geopolitical tensions persist and the continues, more NRIs (non-resident Indians) could move back to India while residents defer overseas travel, boosting domestic luxury spending. This could drive a strong sales growth in Q1 (April–June) of FY27, a period that’s usually subdued for luxury sales, he added.
Pushpa Bector, senior executive director and business head at DLF Retail, echoed Kataria. She said that with international travel likely to be deferred, there could be a gradual shift towards higher domestic consumption, which may support luxury demand locally.
Across categories, however, the impact appears uneven depending on customer segments. For luxury kids wear companies like Jacadi Paris in Mumbai and luxury gourmet brands such as Royce, March has turned out to be a strong month. Samir Gadhok, co-founder of Burgundy Brand Collective, which has brought the French brand Jacadi and Japanese chocolatier Royce, said the company’s UHNI (ultra-high-net-worth individual) patrons remain largely unaffected by the geopolitical situation and continue to shop as usual.
Purchases by high-net-worth individuals (HNIs), however, have seen a dip, with some customers postponing consumption for the next few months.
“Right now, it is business as usual for us, and the impact, if any, would be felt in the coming months,” he said. Burgundy Brand Collective has also brought in luxury furniture brand Ligne Roset to India.
This divergence is also visible in online trends. Ultra-high-net-worth individuals continue to indulge themselves, while aspirational buyers may be holding back. Nakul Bajaj, who runs luxury website Darveys, said the company has recorded its best March in several years, underscoring that domestic luxury consumption may well be absorbing the slack from muted international travel. “Brands like Fendi and Pinko have seen particularly strong traction during the month, and we expect at least 40% growth in Q1 FY27 compared to the current quarter (Q4), driven in part by continued moderation in outbound travel.”
Even as near-term indicators improve, the recent financial performance of luxury companies presents a mixed picture. Several big companies showed muted growth in FY25, data from filings with the ministry of corporate affairs accessed via Tofler showed. Overall, the top companies had a healthy growth of at least ₹5,000 crore of luxury sales collectively in FY25, some companies slowed down.
Gucci India’s revenue declined 17% to ₹265.4 crore in FY25, while Christian Dior saw a 3% dip to ₹257 crore from a year earlier. Revenue at Louis Vuitton also fell for the first time in five years to ₹802.47 crore, down by 1.6%. In contrast, Hermès India reported a 33% increase in revenue to ₹427.9 crore. Other categories like Swiss watch exports to India also rose 8% to ₹3,500 crore in CY25, said the Federation of the Swiss Watch Industry.
Freight and other rising costs
However, cost pressures remain a key concern for the sector despite the demand-side tailwinds. Industry executives said that improving domestic sentiment, rising costs for luxury goods, and a slow return of affluent Indians from abroad could combine to make the traditionally quiet April-June quarter unexpectedly strong. Luxury brands are now keeping a close watch on consumer behaviour, freight costs, and inventory flows, hoping that India’s homegrown appetite can sustain the momentum.
Within this, logistics and pricing dynamics are emerging as critical variables to monitor. DLF’s Bector said that while the outlook remains encouraging, the impact of currency movements and elevated freight costs on future pricing of luxury goods will become clearer over time. Similarly, Kataria of Luxerati added that freight costs have risen to around 13% since the Iran war began, up from the usual 10%, even as inventory levels remain comfortable.
Luxury lighter and pen maker S.T. Dupont’s India partner, Luxury Ampersand Frolic, is facing supply pressures, with co-founder Raahuul Kapoor noting that shipments are arriving slower and transport costs, especially for hazardous materials, have surged to nearly four times pre-war levels.