India's online retail market is projected to cross $90 billion in 2026, registering an annual growth of 22-24%, its fastest expansion in five years, driven by everyday consumption categories such as grocery rather than mobile phones, Redseer Strategy Consultants said in a report.

According to the analysis, ecommerce gross merchandise value (GMV) expanded roughly 25% year-on-year to about $38 billion in the first half (H1) of 2026, marking its strongest H1 performance in four years.

While online retail accelerated, mobile sales remained flat at 0% growth during the first half and are projected to grow by just 2-3% across the full year due to sharp price increases curbing sales volumes.

Consequently, the grocery segment is poised to overtake mobile phones as the second-largest category in Indian ecommerce, behind fashion.

"This year, India's online retail is growing fastest where demand is steadiest," said Kushal Bhatnagar, Partner at Redseer.

The report noted that grocery, beauty and personal care (BPC), and home and furniture will account for about 40% of overall online retail GMV in 2026 and roughly three-fifths of the incremental GMV added during the year.

Grocery alone is projected to account for nearly a third of the added GMV, expanding 50-53% for the full year and lifting its market share from 16% in 2025 to 19% in 2026. Mobiles, which accounted for around 19% of total sales last year, are expected to see their market share drop to roughly 16%.

BPC is projected to rise 36-39%, while home and furniture is estimated to expand 31-34% in 2026.

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