The India cigar and cigarillos market constitutes various products including wrapped in tobacco leaves or contain tobacco. These products are usually filled with tobacco and are smoked. Cigars are larger than cigarettes and are wrapped in tobacco leaves rather than paper. Cigarillos are smaller than cigars and come in the form of cigarettes or cigar shapes wrapped in tobacco. These products are consumed widely across demographic segments and provide relaxation and stress relief. The rising disposable income enables people to spend on premium tobacco products including cigars and cigarillos. With the growing working population and improving economic conditions, the demand for such products is expected to surge in India over the coming years.
The India cigar and cigarillos Market is estimated to be valued at US$ 3659.92 Bn in 2024 and is expected to exhibit a CAGR of 10% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the India cigar and cigarillos are Acuity Brands Lighting Inc.,Cree Lighting,Dialight,Digital Lumens Inc.,Hubbell,LSI Industries Inc.,LumiGrow,Panasonic Corporation,Siteco GmbH,Signify Holding,Semiconductor Co. Ltd.,Zumtobel Group Ag. Acuity Brands Lighting Inc. is one of the leading companies offering a wide range of cigar and cigarillos.
The increasing number of young working professionals with rising disposable income has fueled the demand for premium tobacco products including cigars and cigarillos. Various promotional activities by companies to introduce new flavored variants catering to varied consumer tastes have also boosted the demand for these products.
New technologies are playing a vital role in enhancing the user experience while consuming cigars and cigarillos. For instance, the development of cigars and cigarillos enabled with lightweight sensors that analyze smoking habits, provide health insights, and integrate with mobile apps. Some companies are also offering connected cigarillos that allow remote monitoring and social sharing of smoking sessions.
Market Trends
One of the major trends in the India Cigar And Cigarillos Market Growth is the rising popularity of premium cigar varieties and luxury brands. Various companies are launching super premium and exclusive hand-rolled cigars targeted at high-income customers willing to spend more on luxury products. Another trend is the growing demand for organic and natural cigar products. Companies are responding to this demand by introducing organic cigar and cigarillo variants made from agricultural ingredients grown without pesticides and chemical fertilizers.
Market Opportunities
One of the key opportunities for players in the India cigar and cigarillos market is to foray into the smaller towns and cities. With growing disposable incomes, the consumption of premium tobacco products is gradually increasing even in Tier-2 and Tier-3 cities. Companies can leverage this opportunity by enhancing their rural and semi-urban presence. Secondly, the burgeoning young working professional demographic engaged in social drinking presents a lucrative customer base that companies can target through innovative product campaigns and brand engagement programs.
Impact of COVID-19 on India Cigar and Cigarillos Market
The COVID-19 pandemic significantly affected the India cigar and cigarillos market in 2020 and 2021. During the lockdowns imposed across major cities and states to contain the spread of the virus, production and supply came to a halt. Manufacturers had to temporarily shut down facilities, while shops selling cigars and cigarillos were closed for months. This led to a sharp decline in sales volumes during these periods. However, as restrictions eased, production and supply chains gradually resumed operations while following safety protocols.
The pandemic accelerated the growth of online platforms for the purchase of cigars and cigarillos. As people stayed indoors and avoided crowded spaces, they turned to digital platforms to make purchases. Many manufacturers and retailers leveraged this opportunity by boosting their online presence and offering doorstep delivery services. Initiatives such as these helped revive demand to some extent in the post-lockdown months of 2020 and 2021.
Going forward, the market is expected to recover steadily as economies reopen fully and consumers feel more confident about venturing out. However, supply chain disruptions and higher input costs due to pandemic-related difficulties may pose challenges. Manufacturers will need to strengthen their digital capabilities further and focus on innovative product launches to aid the market's growth prospects in the forecast period.
India Cigar and Cigarillos Market: Regions of Concentration
In terms of value, the India cigar and cigarillos market is concentrated in major metropolitan areas such as Delhi, Mumbai, Kolkata, Chennai, Bengaluru, and Ahmedabad. These cities collectively account for over 60% of the national market owing to higher per capita incomes and exposure to global lifestyle trends among urban populations. Within these regions, premium cigar lounges and stores catering to high-net-worth individuals located in upmarket neighborhoods generate the highest revenues.
The northern and western regions covering Delhi, Haryana, Punjab, Rajasthan, Gujarat, and Maharashtra dominate overall in market value terms due to large urban centers driving sales. However, growing prosperity in southern cities is propelling faster growth in Karnataka, Andhra Pradesh, and Tamil Nadu. The eastern region is also witnessing increased demand from the affluent sections of Kolkata and Bhubaneswar.
India Cigar and Cigarillos Market: Fastest Growing Region
The south Indian states of Karnataka, Tamil Nadu, Kerala, and Telangana collectively represent the fastest growing region for the India cigar and cigarillos market. This is attributed to rising incomes, exposure to global lifestyles, and higher recreational spending capability among urban populations in cities such as Bengaluru, Chennai, Kochi and Hyderabad. More young professionals are taking up cigar smoking and premium product sales are witnessing strong growth.
Manufacturers are keenly targeting this region through aggressive branding and promotion campaigns at high-end outlets, clubs and lounges. Significant investments are being made to expand distribution networks and set up exclusive stores. With prosperous populations expected to increase substantially over the next decade, the southern region is viewed as critical for future market expansion by industry players. If trends hold, it will become a major market for cigars and cigarillos nationally in the upcoming years.
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