India’s online retail market is on course to exceed $90bn in 2026, with grocery, beauty and home goods driving faster growth than mobile phones and electronics.
India’s online retail market is set to move past $90 billion in 2026, but the clearest growth is coming from the less glamorous corners of e-commerce. Grocery, beauty and personal care, and home and furniture are emerging as the main engines of expansion, while mobile phones are losing ground, according to Redseer Strategy Consultants.
The consultancy said India’s e-commerce gross merchandise value rose about 25% year-on-year to nearly $38 billion in the first half of 2026, the strongest opening half in four years. That puts the industry on course for its fastest annual growth in five years, even as spending shifts away from big-ticket electronics towards everyday purchases.
“This year, India’s online retail is growing fastest where demand is steadiest,” Kushal Bhatnagar, a partner at Redseer, said in the report. Grocery is forecast to expand 50% to 53% over the full year, lifting its share of online retail sales from 16% in 2025 to 19% in 2026. Redseer said the category could generate almost a third of the extra gross merchandise value added this year, and it is expected to overtake mobiles as the second-largest online retail segment after fashion.
Mobile phones, by contrast, have had a weak year. Redseer said sales were flat in the first half of 2026 and are likely to rise just 2% to 3% for the full year, with sharp price increases weighing on demand. Mobiles accounted for about 19% of online retail sales in 2025, but their share is projected to slip to around 16% this year. Beauty and personal care is expected to grow 36% to 39%, while home and furniture is forecast to rise 31% to 34%, underscoring how non-electronics categories are taking a larger role in e-commerce growth.
Electronics has shown signs of recovery, with sales up 22% in the first half after a 5% decline a year earlier, but Redseer expects that momentum to cool in the second half as the one-off boosts fade. The report linked the rebound to a cut in goods and services tax on large appliances from 28% to 18% in September 2025, deep discounts on air-conditioners after changes to Bureau of Energy Efficiency star ratings, and shortages of liquefied petroleum gas that helped drive a surge in induction cooktop sales. Early laptop buying ahead of expected component price increases also helped, though Redseer described some of the demand as “pre-loaded”.
The festive season is likely to reinforce the same pattern. Redseer expects online sales in the 30 to 35 days before Diwali to climb about 25% year-on-year to between $15 billion and $16 billion, the strongest festive growth in five years. Grocery, beauty and personal care, home and furniture, and general merchandise are expected to keep outperforming, while mobiles and electronics together are projected to fall below half of festive gross merchandise value, reflecting higher prices and softer volumes.
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