India Security Services Industry Poised for 9-11% Growth in FY25

The growth is expected to benefit micro, small, and medium enterprises (MSMEs), which account for 40-45% of the industry. The sector comprises a mix of large multinational firms, Indian corporations, and smaller unorganised players.

Key factors such as the government’s infrastructure push, rapid urbanisation, a rising crime rate, and a low police-to-population ratio continue to fuel demand for private security services. Additionally, advancements in artificial intelligence, biometrics, and drones are reshaping the industry, as businesses increasingly turn to technology-driven security solutions amid rising labour costs and a shortage of skilled workers.

However, despite the promising outlook, MSMEs in the sector face significant challenges, including thin profit margins, limited scalability, and working capital constraints. These factors make it difficult for smaller firms to compete for high-value contracts in high-demand locations like shopping malls, special economic zones, IT parks, and residential townships. As a result, market consolidation is accelerating, with smaller players exiting due to financial pressures.

Private security firms primarily offer manned guarding, cash management, and electronic security services, with manned guarding—deploying personnel for premises and individual security—accounting for 75-80% of the market. Labour costs remain the largest expense for companies in this space, making them vulnerable to regulatory changes, compliance requirements, and fluctuations in minimum wages.

With the industry evolving rapidly, companies that can adapt to new technologies and navigate regulatory challenges are likely to emerge stronger in the increasingly competitive landscape.