I had to take an unplanned break "thanks" to my ISP, but now I am back with full power. In recent months we read some really disappointing news about the BRIC countries (Brasil, Russia, India and China).
In the quarterly survey of 900 Bloomberg customers was conducted Sept. 10, the asked ones said India is among the worst markets for investors in the next year. India is also the poorest among the 4 BRIC countries.
Although India is Asia’s third-biggest economy, but nowdays is among the most vulnerable ones. The Indian economy's growth rate fell back sharply since the 2003-2008 boom to the growth level of 4-5% (it is still bigger than what we can expect in the US). If you check the chart below, then we can say that the Indian economy may fall further. Consumer-price inflation remains stubborn at 10%. So India can easly become from star to dog.
What is the future of golf in India?
In February I have already mentioned that the business potential of golf in India will be bigger if common men will afford to play golf. Currently 25% of India's population is middle class (vs. 63% in China). This is why I am more optimistic about China.
The base of high-spending middle-class consumers is still small. The “middle middle” (spending $4 to $10 a day) and the “upper middle” (spending $10 to $20 a day) together make up just over 50 million people. This shows me a very small growth potential. Personally I would not invest (real estate, golf course, golf academy etc.) in golf in India until I see stable business environment and reasonable size of potential golf players.
At the same time it might be an opportunity to low end golf equipment manufacturers. To face such business challenge, golf course owners should come up with really smart green fee pricing strategy (e.g. dynamic pricing strategies). This struggle will be bigger than what we see in the US or in the UK.
Due to weaker Indian economy performance, some of the major Indian golf events had to be canceled: the Avantha Masters, the nation’s richest golf event, and the Kensville Gujarat Challenge, a stop on the European Challenge Tour.