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The combined retail mall space in the top six markets, totalling 105 million square feet (msf), is projected to rise to 116-118 msf by March 2025. According to credit rating agency ICRA, the anticipated new supply in India's top six cities is 9-10 msf in FY2024 and approximately 6 msf in FY2025. Delhi NCR leads with a 30% supply contribution, followed by Bengaluru (20%), MMR (17%), Pune (14%), Hyderabad (13%), and Chennai (6%). ICRA foresees Delhi NCR, Pune, and Hyderabad accounting for 85% of the new supply in FY2025, with 10% of the upcoming supply already pre-leased as of September 2023. Mall operators can expect a 9-10% YoY growth in rental income in FY2024 and 8-9% in FY2025. This growth is attributed to healthy occupancy levels, projected increases in trading values, and rental escalations. In H1 FY2024, ICRA's sample set experienced an 8.4% YoY increase in rental income. Anupama Reddy, Vice President and Co-Group Head, Corporate Ratings at ICRA, notes the strong rebound in footfalls and trading values seen in FY2023 and H1 FY2024. She anticipates a 14-15% increase in trading values in FY2024 and a 10-12% growth in FY2025, driven by factors like premiumisation and robust urban consumption. Various segments, including jewellery, electronics, premium apparel, beauty care products, and entertainment, have witnessed above-average consumption growth in recent quarters. This trend is expected to continue in the near to medium term due to strong consumer demand. The private final consumption expenditure component of India's GDP has been on the rise, supported by increased spending by households. According to the RBI?s Consumer Confidence Survey of September 2023, household spending has remained buoyant over the past year, driven by higher essential and non-essential spending. This trend is expected to persist over the next 12 months, providing support for retail sales among mall operators' tenants. Although net absorption was robust at 3.2 msf in H1 FY2024, vacancy levels increased marginally by 100 basis points to 20% as of September 2023, primarily due to the recent operationalisation of 5.6 msf of new supply. ICRA anticipates occupancy levels to be sustained at 81-82% as of March 2024 (compared to the previous year's 81%) and to improve to 82-83% by March 2025. Reddy concludes that ICRA expects the credit profile of mall operators to remain stable, supported by healthy Net Operating Income (NOI) driven by trading value and rental growth, moderate leverage, and comfortable debt coverage metrics.