Swedish home furnishing company IKEA has opened its first Indian retail store in Hyderabad, Telangana.
Spread across nearly 400,000ft², the store has seen IKEA reportedly invest Rs10bn ($145.7m), which represents 10% of the company’s total investment proposal.
It is claimed to be one of the biggest foreign investments in the Indian Home market.
The store was originally planned to open on 19 July, but decided to move it to today “as it needs some more time to live up to its expected quality commitments towards customers and coworkers”, according to the company.
IKEA Retail India CEO Peter Betzel said: “Our main priority is to create an inspiring and safe experience for both customers and coworkers.
“Opening the first Indian IKEA store in Hyderabad means a lot to IKEA and we want to offer the best possible meeting with IKEA for the many Indian customers.”
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Considering the rapid increase of incomes among urbanites in India, the company expects the Indian Home sector to grow at a compound annual growth rate (CAGR) of 10.9% during 2016-2021 and reach Rs4,979.3bn ($72.61bn) by 2021.
GlobalData Consumer and Retail Research director Sumit Chopra said: “IKEA’s foray will impact the market share of branded players. The Indian Home market is highly fragmented with the top five players accounting for just 2% market share.
“In addition, IKEA’s strategy to build a strong offline presence and build a brand image among customers, where they can see and feel products associated with the brand and use e-commerce as a supplement channel, will also provide a new experience to the consumers.
“As a result, branded players will have to offer differentiated products and services.”