Indian direct selling market to touch Rs 5,320 cr by 2012-13

NEW DELHI: Driven by a robust growth in the health segment, Indian direct selling market that grew 17 per cent last fiscal is poised to touch Rs 5,320 crore by 2012-13, according to a report by consultancy firm Ernst & Young.

The report said direct selling market--selling to customers without the use of intermediaries--was valued at Rs 3,300 crore last fiscal and will grow at 10-15 per cent for the next 1-2 years.

"This is expected to take the overall, direct selling industry, excluding insurance to Rs 5,320 crore by 2012-2013," it said.

The E&Y report attributed the robust growth of the sector to expansion by several direct selling companies to Tier I and II as well the rural areas.

It said health, comprising of products related to nutrition, wellness and supplements, has emerged as the leading category, contributing 32 per cent to the overall revenues of the direct selling companies.

"At this time of the slowdown, this market has grown because of the good growth of the health sector, which is largely recession free. Besides, it has also become a source of employment for several people," Indian Direct Selling Association Chairman and Managing Director Oriflame India Fredrick Widell said.