Retailers in Karnataka and neighbouring Tamil Nadu have been a worried lot for the past few days staring at a stunted business recovery in Jan. ‘22 after a fantastic year end. Almost all formats of hospitality, F&B and Retail including apparel, fashion and footwear were jubilant with sales achievements in December’21 after 6 continuous quarters of poor sales. Many retailers we spoke to confirmed that they achieved pre-Covid sales in the month, thanks to a continued consumption pattern since Oct. ‘21 after an aborted third wave which was predicted around August last year.
To reduce the spread of the Omicron variant of Covid-19 virus, Karnataka State has announced night curfew from 10pm to 5am and a full weekend curfew on Saturday and Sunday – the end date of this has not been announced though. Tamil Nadu has announced closure of all public places including religious places from Friday- Sunday and a full lockdown on Sundays as well as a night curfew from 10pm – 5am. The State’s GO doesn’t have an end date either.
Many regional retail chains had been expecting a huge upswing in sales ahead of Sankranthi / Pongal festivals which are celebrated in both states. This, after the trend which was witnessed in December especially in leisure travel and dining out where businesses saw record sales and spending by customers. However, the recovery party seem to have been stunted with the lockdown moves.
Most Retailers are also positive that these lockdowns will be a short term move to curb rise in cases of Covid-19 and are hopeful that things will normalise around Republic Day later this month. The crucial Q4 of FY 21-22 will make or break many P/L statements for retailers in India. It is to be seen how fast this recovery is going to happen within.