IKEA Commits $2.2 Billion to Expand Indian Operations
Swedish furniture retailer IKEA has revealed ambitious plans to significantly boost its presence in India. The company will more than double its investment in the country, committing over $2.2 billion over the next five years. This substantial financial push aims to fuel rapid expansion across multiple fronts.
Expanding Store Network and Local Sourcing
IKEA intends to open many more stores throughout India. The retailer currently operates its first and only Indian store in Hyderabad, which launched in 2018. Under the new plan, IKEA targets expanding its physical footprint to a total of 30 stores nationwide.
Alongside store expansion, the company will increase its local sourcing within India. IKEA plans to double its production for both domestic stores and exports, raising the total to 800 million euros. This move supports the Indian manufacturing sector and aligns with global trends of brands ramping up export production in the country to manage costs.
Innovative Online-First Strategy
In a notable shift, IKEA will adopt an online-first approach in new Indian markets. The company will begin accepting online orders in cities like Chennai and Coimbatore before establishing any physical stores there. This strategy marks a global first for the furniture giant.
Bhavana Jaiswal, IKEA India's e-commerce integration manager, explained the reasoning. Young Indian consumers increasingly prefer online shopping to avoid traffic congestion. Launching digital operations first allows IKEA to reach customers quickly while planning future brick-and-mortar locations.
Strong Growth Targets and Market Confidence
Patrik Antoni, CEO of IKEA India, expressed strong confidence in the Indian market. He stated that India is not yet a major market for IKEA but has the potential to become one of its top global markets. The company's sales in India grew 6% to 18.61 billion rupees in the fiscal year ending August 2025.
Building on this growth, IKEA aims to quadruple its Indian sales. This aggressive target reflects the company's long-term belief in India's consumer economy. Antoni also noted that recent U.S. tariff increases on some Indian goods have not significantly impacted IKEA's local suppliers, as the brand primarily serves European markets.
The investment announcement comes as numerous international brands increase their focus on India. Companies from various sectors, including footwear and automotive, are stepping up sourcing to meet rising domestic demand. IKEA's expanded commitment signals a vote of confidence in India's retail landscape and economic trajectory.
