India's new-age economy to triple to $300 billion by FY31: Redseer report

New Delhi: India's new-age economy is projected to triple to USD 300 billion in revenue by financial year 2030-31, closely approaching the scale of the country's IT services sector, according to a report by Redseer Strategy Consultants.

A new-age economy is driven by AI, knowledge capital, and digital innovation.

The combined revenue of domestic new-age companies is estimated to rise from USD 33 billion in FY22 to around USD 100 billion in FY26, before growing at 25 per cent annually to touch the USD 300-billion mark by FY31, the report noted.


According to Redseer, consumption-led sectors comprising consumer goods, retail, and leisure will remain the cornerstone of this expansion, growing at 25 per cent annually to reach USD 150 billion by FY31 and accounting for nearly half of the overall market.

Meanwhile, emerging technology sectors such as technology, media, and telecom (TMT), artificial intelligence (AI), and advanced manufacturing are projected to grow at 26 per cent annually.

On operational performance, the report highlighted that the collective profit pool turned positive in FY25, staging a turnaround to USD 1.4 billion.

However, profitability remains heavily concentrated.

"BFSI alone is 140 per cent of the FY25 pool; take it out and every other sector put together is still loss-making," the report stated, adding that a USD 300-billion top line by FY31 implies a total profit pool of USD 5-10 billion (2 to 3 per cent margin), compared to 12-18 per cent for listed FMCG firms and 20-25 per cent for IT services.

The report also pointed out that the time required for consumer goods brands to achieve scale has significantly compressed. Owing to the rapid expansion of direct-to-consumer (D2C) channels and quick commerce, the average time taken to reach Rs 100 crore in revenue fell from 6.8 years for brands in 2016 to 3.4 years for the 2020 cohort.

Similarly, the time to hit Rs 500 crore halved from 7.9 years to 4 years. Redseer expects the number of new-age consumer brands with revenues above Rs 100 crore to surge from roughly 90 in FY22 and 230 in FY26 to approximately 500 by FY31.

However, scaling beyond the "Rs 500-crore wall" remains a key hurdle due to the requirement of building deep offline distribution networks, modern trade capabilities, and working capital infrastructure.

Out of approximately 110 brands founded since 2016 that crossed Rs 100 crore in revenue, only 26 have cleared the Rs 500-crore threshold, and only eight have crossed Rs 800 crore.

On the capital supply front, private market funding is projected to increase 25 per cent year-on-year to USD 17 billion in calendar year 2026, driven primarily by disciplined investments in BFSI, TMT, and AI, which together secured 60 to 65 per cent of deal value this year.

By calendar year 2030, total public and private market fundraises for new-age companies are expected to touch USD 50 billion annually, consisting of USD 35 billion in private funding and USD 15 billion via public listings.

The report projected that new-age enterprises will account for about 40 per cent of all Indian initial public offering (IPO) proceeds by CY30, up from 25 per cent at present.