Retailers are starting to experience rising input cost pressures, particularly linked to global developments in energy markets
Retail sales in India recorded a 9 per cent year-on-year growth in February 2026, reflecting a normalisation in consumption following a strong festive-led performance in November and December, according to the latest retail business survey by the Retailers Association of India (RAI).
The findings suggest that underlying consumption demand continues to hold steady, supported by sustained urban demand and ongoing contribution from non-metro markets. At the same time, retailers are beginning to experience rising input cost pressures, particularly linked to global developments in energy markets, which could have downstream implications for margins and pricing.
“After a strong festive-led performance in November and December, retail growth in February reflects a normalisation to more stable consumption levels. The broad-based performance across regions and continued strength in key categories such as apparel and food & grocery indicate that consumption remains steady,” stated Kumar Rajagopalan, Chief Executive Officer, RAI.
Performance remained broad-based across regions, with the west and east reporting relatively higher growth at 10 per cent each, followed by north and south India at 9 per cent and 8 per cent respectively. Category-wise, apparel and clothing, along with food and grocery, led growth at 12 per cent and 11 per cent respectively. On the other hand, discretionary segments such as consumer durables saw relatively softer traction at 7 per cent.
RAI stated that on an overall basis, consumption remains stable, but the operating environment is becoming more complex. Growth in the coming months will depend on how effectively retailers navigate cost pressures while continuing to serve an increasingly diverse and evolving consumer base.
Industry stakeholders note that while global geopolitical developments, including tensions affecting key energy supply routes, may influence inflation and logistics costs, the immediate impact on consumer demand has so far remained limited.
The industry body added that looking ahead, retail growth is expected to be driven by underlying demand fundamentals, including expansion in non-metro markets, improving supply chain efficiencies, and continued evolution in retail formats.
