IKEA to invest over $2.20 billion in India over next five years

Sweden’s IKEA will more than double its investment in India to over 200 billion rupees ($2.20 billion) over the next five years, as the furniture retailer looks to expand its store network and increase local sourcing, a senior executive said on Monday.

IKEA, which opened its first store in India in 2018 in Hyderabad, plans to begin accepting online orders in four additional cities where it does not yet have physical stores, including Chennai and Coimbatore in Tamil Nadu.

“(India) is not a large IKEA country yet … But the belief in India is very strong that it will be one of our top markets,” Patrik Antoni, CEO of IKEA India, told Reuters.

IKEA’s sales in India rose 6 per cent to 18.61 billion rupees in the year ended August 2025. Antoni said the company aims to quadruple sales, including by expanding the number of stores to 30 from the current six.

The company plans to start online operations in new cities before opening physical stores, marking a first for IKEA globally. The approach reflects changing consumer behaviour, with younger customers increasingly shopping online to avoid traffic congestion, said Bhavana Jaiswal, country e-commerce integration manager.

Online sales currently account for more than 30 per cent of IKEA’s total India revenue, and the retailer aims to increase this share to 40 per cent.

IKEA also plans to double production for domestic stores and exports to 800 million euros ($930 million), Antoni said.

The expansion comes as global brands increase export-oriented production in India to reduce costs. Consumer companies, ranging from footwear maker Asics to automaker VinFast Auto, have also stepped up sourcing from India to meet domestic demand.

US President Donald Trump last year doubled tariffs on some imports from India to as much as 50 per cent, prompting several industries to seek new overseas markets. Antoni said the tariff hikes have not significantly affected IKEA’s Indian suppliers, as the company, which has most of its stores in Europe, ships a larger share of products to other markets.

(With inputs from Reuters)