Indian Luxury Market At An Inflection Point: 2026 And Beyond

Indian luxury market is entering a decisive growth phase. By 2026, the country will not just be a high-potential market, it will be one of the most structurally important luxury growth engines globally. With strong macro fundamentals, rapid wealth creation, and a young, aspirational consumer base, India is now firmly positioned among the top three fastest-growing luxury markets in the world.

According to Euromonitor International, India’s luxury goods market is projected to grow at 10% annually, reaching USD 12.1 billion by 2025 and expected to cross USD 14-15 billion by 2026. This growth significantly outpaces mature markets like Europe (2-3%) and even China (4-5%), making India a rare high-growth, high-scale opportunity for global luxury brands.

Wealth Creation: The Core Growth Engine

Luxury growth in India is fundamentally driven by wealth expansion. India added 39,000 new dollar millionaires in 2024, taking the total to  around 917,000 millionaires. By 2027, India is projected to cross 1.2 million millionaires. India now accounts for nearly 30% of new global middle-class consumers, the highest share worldwide. By 2030, addition of 110 million middle-income households is predicted according to Deloitte report.

‘Henry’ (high income not rich yet) and ‘DINKs’ (dual income no kids) are rapidly growing force in India’s luxury market. This segment of working professionals with rising disposable incomes is pushing demand for experiential, lifestyle-led, digitally influenced and authentic luxury.

Urbanisation and Tier-2 Expansion

India’s luxury consumption is no longer concentrated solely in metropolitan hubs such as Delhi and Mumbai. Recent findings from the Tata Cliq Luxury report reveal that over 50% of luxury sales now originate from tier 2 and tier 3 cities, including Surat, Raipur, Lucknow, and Guwahati. This shift highlights a significant transformation in the country’s consumption landscape.

To capitalize on this growing opportunity, international luxury brands are increasingly embracing digital platforms to penetrate emerging markets. Brands like Bulgari, for instance, are leveraging online channels to connect with affluent consumers beyond traditional metros. The expansion of luxury demand is not limited to fashion alone; non-metro regions are also contributing substantially to luxury car and jewellery sales. This trend is also evident in the automobile sector, where approximately 25% of Lamborghini’s super-luxury car sales in India now come from cities outside the major metropolitan areas. Urbanization is acting as a catalyst for economic and social transformation, creating a large, aspirational consumer base that is willing to splurge on luxury goods and experiences.

Digital, Social, and Omnichannel Luxury

India is redefining luxury distribution. India has 900+ million internet users and 450+ million social media users. Over 60% of luxury discovery now happens online. Luxury brands in India are investing heavily in omnichannel strategies, private previews, WhatsApp commerce, and influencer-led storytelling to localise global brand narratives. Recently, the entry of the iconic French department store Galeries Lafayette into India housing over 250 global luxury and designer brands within a 90,000 sq. ft experiential retail space stands as a strong testament to the rapid evolution and growing maturity of India’s luxury retail landscape.

Key High-Growth Luxury Segments

Luxury Cars: Luxury automobiles remain the largest and fastest-scaling luxury category in India. According to Euromonitor International, luxury cars segment is expected to close 2025 with ?44,540 crore in sales marking 18% YoY growth. This sector is further projected to expand at a 17.2% CAGR between 2026 and 2030. German brands dominate, but ultra-luxury marques (Bentley, Rolls-Royce, Lamborghini) are witnessing 20–25% annual growth, driven by ultra-HNWIs and business families.

Experiential Luxury: Travel, wellness, bespoke dining, private aviation, and curated experiences are emerging as the most disruptive growth engine in India’s luxury market. According to Euromonitor International, the experiential luxury category which includes fine dining, luxury holidays, high-end events and lifestyle experiences is projected to reach ?24,830 crore in 2025, growing at a 21.4% annual rate. Over the next five years (2026-2030), this segment is expected to post a transformational 77.8% CAGR. Indian consumers are increasingly prioritising “memories over materialism”, spending more on private villas, destination weddings and wellness retreats.

Luxury Beauty and Personal Care: Luxury beauty is rapidly emerging as a gateway category for first-time luxury buyers in India, driven by affordability relative to other luxury segments, high brand visibility, and strong digital distribution. India’s luxury beauty and personal care market is expected to double in size from approximately USD 800 million in 2023 to USD 1.6 billion by 2028, representing a 15–18% CAGR nearly twice the global luxury beauty growth average. Younger consumers, influencers, and global brand accessibility via e-commerce are accelerating penetration beyond tier1 cities.

Future Outlook

By 2030, India’s luxury market is expected to exceed USD 20 billion, with experiential luxury, automobiles, and beauty accounting for over 65% of total value. More importantly, India will shift from being a “future market” to a core global growth pillar for luxury brands. In a world of slowing luxury demand, India offers something rare: scale, speed, and sustained aspiration making 2026 not a peak, but a powerful inflection point for the Indian luxury economy.

(This article has been previously published with BW)