Strongest regional growth in North and South; store-level demand recovery signals firmer footing ahead of festive season
August 24, 2026
India’s retail sector grew 8% year-on-year in July 2026, according to the Retailers Association of India’s (RAI) Business Survey Round 73, with everyday, needs-based categories carrying the month.
The reading comes weeks after RAI’s SANKET report, produced with payments partner Innoviti, showed genuine store-level demand recovering to 7.1% growth in July — its strongest month since the quarter began. Read together, the two data sets point to a sector building real momentum just as retailers begin preparing for the festive season.
Regional Performance
Growth varied sharply by region in July:
| Region | YoY Growth |
|---|---|
| North | 9% |
| South | 9% |
| West | 6% |
| East | 6% |
The North and South posted the strongest growth in the survey, while the West and East grew more moderately. This regional spread echoes what SANKET found at the store level — the South held up strongest of any zone through the quarter, while the West saw the sharpest swing, dropping furthest in Q1 before rebounding hardest in July.
Category Performance
Category-level data points to what has actually driven purchases through the month.
Habit-led categories outperformed:
| Category | YoY Growth |
|---|---|
| Quick service restaurants | 13% |
| Food & grocery | 12% |
| Footwear | 10% |
| Apparel | 8% |
Deliberation-led categories lagged:
| Category | YoY Growth |
|---|---|
| Consumer durables & electronics | 7% |
| Jewellery | 6% |
| Sports goods | 4% |
| Furniture | 1% |
Outlook
With Q1’s softness now behind the sector and July showing recovery on both overall and store-level measures, RAI’s reading is that retailers enter the festive season from a firmer base than the one they were standing on three months ago — though the categories that will matter most this festive season, namely big-ticket purchases, are still growing well below the categories built into daily routine.
“July gave us two confirmations at once: topline growth held up, and genuine store-level demand, which had softened through the summer, came back with it. That matters heading into the festive season, because the big-ticket purchases are exactly the ones festive buying tends to unlock. The base retailers are working from this year is stronger than it was in April or May. Retailers are entering the festive season with optimism, anticipating stronger consumer demand. The job over the next few weeks is preparation — inventory in place, staffing ready, and offers timed for a customer who buys on routine most of the year but saves the bigger decisions for the season that’s built for them.”
Kumar Rajagopalan, Executive Director and Chief Executive Officer, Retailers Association of India
India’s retail future is connected. RAI is building for it.
About RAI
The Retailers Association of India is the national body representing India’s retail industry across all channels and formats, from large format and specialty retail to e-commerce, quick commerce, and connected commerce businesses. RAI works with governments, regulators, and industry stakeholders to enable a competitive, innovation-friendly retail ecosystem. Through policy advocacy, industry events, research, and learning programmes, RAI builds the conditions for retail to grow, invest, and create employment at scale.
