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Nagpur, fastest growing crorepati city
Sunil Jain |
July 15, 2004
Business Standard presents exclusive excerpts from the forthcoming Market Information Survey of Households from the National Council for Applied Economic Research.
This four-part series, which began on Wednesday, will look at India's middle and rich income groups, providing details of where they live, how they have grown over the years and are likely to multiply.
Produced in association with Business Standard the survey will be published shortly. Watch this space for more announcements.
Nagpur's 425 crorepati households, or those with an annual family income of more than Rs 1 crore (Rs 10 million), may pale into insignificance in comparison with Delhi's 5,085 or Mumbai's 4,439, but the city has the sixth highest number of crorepatis in the country.
More important, in the period 1995-96 to 2001-02, the NCAER's latest household income survey shows, Nagpur had the highest annual growth in the number of crorepati households -- 91 per cent per annum.
That is, the number of crorepati households rose from 9 to a mindboggling 425 in this period.
Surat, the number two growth city as far as crorepatis go, saw its numbers grow from 3 to 146, which is a growth of an equally impressive 87 per cent.
Delhi and Mumbai had a much more sedate growth, of 28 and 41 per cent, respectively.
While this is clearly due to their much larger base, from a marketer's point of view, the high growth of the smaller cities is clearly more attractive.
Indeed, cities like Nagpur, Amritsar, Jalandhar have a higher density of crorepatis (the number of crorepatis per million households in the city) than metros like Chennai and Kolkata which have a higher number of crorepatis -- while Kolkata has 180 crorepati households per million households, Nagpur had 958 in 2001-02 according to the NCAER report brought out in association with the Business Standard.
The survey, being conducted annually since 1985-86, is conducted over 300,000 households country-wide.
Interestingly, this group of smaller cities (Nagpur has a population of just 440,000 households and Surat 620,000 households) are the country's growth leaders in most rich income categories right down to households earning between Rs 10 lakh and Rs 20 lakh (Rs 1 and 2 million) annually.
Other cities that figure prominently in the top-growth list are Vadodara, Vijaywada and Ahmedabad -- the last one though, saw a huge fall in growth in the 1998-99 to 2001-02 period and made it to the list only due to very high growth in the earlier period.
Not surprisingly, marketers across the country are now heading to smaller towns. And the results are already very good.
In the automobile sector, for instance, 2003-04 saw a 23 per cent growth in sales in the top 10 cities while those in the smaller 60 cities grew by a whopping 36 per cent.
Indeed, market leader Maruti Udyog sold 80,000 cars in this market, or about a fifth of its total sales for the year.
In the case of rival Hyundai which, though on a much smaller base, there was a 55 per cent hike in sales in this category of towns.
Indeed, according to an ACNielsen survey in October 2002, households in smaller cities like Nagpur and Coimbatore have a consumption pattern quite similar to the top six metros – indeed, in the case of categories like automobiles and home theatres, smaller metros may have an edge.
While 92 per cent of affluent urban households in smaller metros had a 4-wheeler according to the survey, the figure was 83 for the 6 top metros. Part 3: Riches: West Bengal's decline worst