Ikea India has experienced a modest 5% growth in revenue, reaching Rs 1,852 crore for the financial year 2023-24. However, this marks the slowest expansion since the Swedish furniture giant opened its first store in India in 2018. The company also reported a widening net loss of Rs 1,303 crore, an increase of 15% from the previous year.
These losses are largely attributed to investments in infrastructure, new stores, and supply chain development. The total losses in India now stand at Rs 5,550 crore.
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Challenges and Expansion Plans Amid Global Struggles
Despite the economic hurdles and restrained consumer spending, Ikea India has responded by reducing prices on several products by 20%, taking advantage of lower raw material costs. Looking ahead, the company plans to strengthen its presence in the National Capital Region (NCR), with new stores planned for Gurugram and Noida as part of a larger Rs 10,500-crore investment plan.
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Globally, Ikea faced a 5.3% drop in revenue, amounting to 45.1 billion euros in FY24, as lower prices contributed to the decline. Despite this, the company continued to expand its retail network, opening 56 new stores across various markets.
CEO Jesper Brodin expressed optimism about India’s potential, emphasizing that scaling operations will be key to achieving long-term success. He believes that a strategic expansion of 8-10 stores will allow the company to reach the necessary economies of scale.
