CRISIL Ratings: Mall spaces to grow 35 million sq ft in three years amid retail surge


30 November 2023, Mumbai


The retail sector's strong rebound last year is set to propel a significant expansion of India's mall space, with an anticipated increase of 35 million sq ft over the next 2-3 years, says CRISIL Ratings. This growth is further fueled by sustained investments from investors, expected to surpass Rs 20,000 crore in the next four years. Approximately 15 per cent of these investments will come from private equity, global pension funds, and sovereign wealth funds.

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Anand Kulkarni, Director at CRISIL Ratings, highlights the expansion will predominantly occur in Tier II cities, contributing to the addition of about 25 percent of the total mall space.

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Despite substantial capital expenditure plans, mall owners are projected to experience revenue growth of 7-9 per cent in the current fiscal year, maintaining stable credit risk profiles. This positive trend is expected to support a healthy occupancy rate of 95 per cent.


Saina Kathawala, Associate Director at CRISIL Ratings, emphasizes that broad-based consumption across various categories will play a pivotal role in sustaining retailers' operating performance over the medium term.

Sectors like jewelry, restaurants, sports, and electronics have witnessed double-digit growth this fiscal year, with the apparel and footwear sectors also displaying a robust recovery.

CRISIL Ratings reports that credit risk profiles have remained stable this year, attributed to strong operating performance and comfortable balance sheets. The agency anticipates a slight improvement in the debt-to-earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio, from 3.2 times in the last fiscal year to 3 times in the current fiscal year.

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