Before the COVID-19 pandemic, morning walks were a way of life in most Indian towns and villages. People often went out for walks in groups of two to three, which was yet another excuse for socializing. In the past year or so, since social distancing has been the new normal, a lot of conventional morning walkers have taken to biking. If you are in Mumbai, for example, you can see the roads along prominent walks like Carter Road, Band Stand or Marine Drive, dotted with cyclists of all ages.
Sachin Chopra, founder and CEO of Alphavector India (which owns bicycle brand Ninety One), says his monthly ride rates over the past year have increased by 500%. “As children’s cycles have continued to grow at the historic rate of 5-6%, adult fitness has become paramount. A family typically buys three or four bikes until their children reach their teens. After that, the children move away and come back after 25-30 years. This feedback has become very strong. Today, even the 60-year-olds are getting on the bike, ”explains Chopra. Indians are not only more aware of their physical condition, they are also much more concerned with the environment and want to stay closer to nature.
Likewise, Sukanta Das, CEO of Firefox Bikes, says his company has seen its online sales increase tenfold since May 2020. The growth of premium bikes has been six times greater than in pre-COVID times. . “We are currently looking at at least 100 percent volume growth in fiscal 2022, as the strong demand for bicycles that started during last year’s lockdown is expected to continue over the next two years,” says Das. “The demand comes on the heels of the recent rise in cycling caused by fear of taking public transport during the pandemic, combined with a growing trend in both personal fitness and the demand for mobility solutions. urban, ”he adds.
A recent CRISIL report also confirms the high decibel growth of the Indian bicycle industry. The report says demand for bicycles increased 20% with sales likely to hit 1.45 crore units compared to 1.2 crore last year. “The current Covid-19 pandemic has boosted the demand for bicycles due to improved fitness awareness and recreational needs. The resulting improved cash flow – against a backdrop of higher capital spending – will support the credit profiles of CRISIL-rated bicycle manufacturers, which account for 60 percent of the industry’s volume, ”the report says.
India is the second largest bicycle manufacturer in the world. The industry is classified into four segments – standard, premium, children and export. Demand for standard bikes, which is the largest segment (accounting for half of all bikes sold in 2020), is driven by government purchases. Government departments buy these bicycles through competitive bidding and distribute them under various social protection schemes. Demand for high-end and children’s bikes (nearly 40 percent) is driven by fitness and recreation needs. Exports and sales of other types of bicycles constitute the remaining 10 percent of demand. In the five budgets through 2019, bicycle sales volume registered a modest compound annual growth rate of 5%. In fiscal 2020, it fell 22% as government purchases plummeted and several bicycle manufacturers shut down. However, the fate of the industry improved in FY21.
“Pandemic constraints on fitness and leisure options have increased demand for bicycles, especially in the premium and children’s segments. Strong growth in the latter has limited the overall decline in volume for bikes. sales at only 5% during fiscal year 2021, despite a further reduction in This momentum should also continue, given the ongoing second wave of pandemic, and should lead to growth of 22% for the premium segments and kids ”, underlines Nitesh Jain, director of CRISIL Ratings.
The good news this time around is the surge in demand for high-end bikes that obviously offer higher margins and better profitability. The market share for premium bikes has increased from 1,000 bps to more than 50 percent, the CRISIL report says.
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