Personal Care and Hygiene

The Indian Beauty & Personal Care sector: The India Attraction

Beauty and personal care market in India encompasses the following sub-segments: Bath & Shower, Hair Care, Skin Care, Oral Care, Men’s Grooming, Colour Cosmetics, Baby and Child-specific products, Deodorants, Fragrances and Depilatories.

The ecosystem for manufacturing of beauty and personal care products is spread out across the country; some of the prominent clusters are present in Himachal Pradesh, Gujarat, and Maharashtra.
90% of Manufacturing is localised in India across the value chain.
Growing awareness, rising disposable income, increase in number of online and brick and mortar stores have been the key growth drivers for the sector.
Skin care, Hair Care & Bath and Shower products account for the largest market size within the beauty & personal care segment (~62% in CY2023).

$ Bn

Market Size (CY2023)

FDI norms

~$ Bn

Forecasted Market Size

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Arushi Jain

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Reasons to Invest

Rising Discretionary Spends Enabled By Increase In Disposable Income: India's GDP per capita rose to $2,612 in 2023, thus driving discretionary spends to over 50% of retail sales. Furthermore, Rising disposable incomes among the expanding middle class are fueling increased spending on beauty products. The average annual spending on beauty has risen from $10.6 to $11.6 per person, reflecting a shift towards prioritizing personal grooming and self-care.

Universal Access & Reach Courtesy E-Commerce: The rise of online shopping has made beauty products more accessible, with e-commerce expected to contribute significantly to total revenue in the sector. Online sales are projected to account for about 12.7% of total revenue by 2023, allowing brands to reach a wider audience.

Urbanization, changing lifestyles, influence of social media and digital marketing: Social media platforms have become powerful tools for shaping consumer preferences, especially among younger demographics like Gen Z. This demographic is increasingly influenced by digital content creators and beauty influencers, driving demand for innovative and trendy products. Rapid urbanization is leading to shifts in consumer preferences, particularly among urban dwellers who seek products that address specific concerns like pollution and sun damage. As more people move to cities, the demand for beauty products tailored to urban lifestyles is increasing.

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FDI Norms

The Indian government allows 100% FDI in single-brand retail and 51% in multi-brand retail, which has opened the door for international beauty brands to enter and expand in the Indian market. This policy encourages foreign companies to invest directly in local operations, enhancing their market presence and reducing import costs.

100%

Foreign equity in single-brand retail

Government Support

Goods and Services Tax (GST)

The introduction of GST has streamlined the tax structure for the beauty and personal care industry, making it easier for businesses to operate across states. This simplification has reduced compliance burdens and improved the overall business environment.

Bureau of Indian Standards (BIS) Regulations

The BIS has established guidelines for the manufacturing and labeling of cosmetics, ensuring product safety and quality. These regulations help maintain consumer trust and promote high standards within the industry.

Digital India Initiative

The push for digitalization under this initiative has facilitated e-commerce growth in the beauty sector. Online platforms are becoming increasingly important for sales, with e-commerce expected to be a significant driver of market growth.

Foreign Direct Investment (FDI) Policies

The Indian government allows 100% FDI in single-brand retail and 51% in multi-brand retail, attracting international beauty brands to invest in India. This policy fosters competition and innovation within the domestic market.

Trade scenario

Personal Care and Hygiene

India’s biggest export destinations in this sector are USA, China, Singapore and UK.

India's imports amounted to ~ $2.7 Bn for FY24.

India's exports amounted to ~ $3.7 Bn for FY24.

*Note: The information for the above comprises of HSN codes: 3301, 3302, 3303, 3304, 3305, 3306, 3307, 3401, 3402 and 8212

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Product Profiles

Oral Care
Hair Care
Fragrance Products

The Indian Oral Care market is primarily sub-segmented into 4 major categories: toothpaste, toothbrushes, toothpowder, mouthwash, and others.

In India, the Oral Care segment generated revenues of over $1.78 Bn in 2022, and the market is expected to grow at a CAGR of 4.5% between 2022 and 2026 to reach $2.13 Bn by FY26.

Some major players dominating India's oral care market are Colgate Palmolive, Hindustan Unilever Ltd., GlaxoSmithKline Consumer Healthcare Ltd., Johnson & Johnson, etc.

Premium category products, which include mouthwash, mouth spray, and electric toothbrushes, are gaining prominence in this sector and pose a latent opportunity for growth. This is complemented by public-private partnership efforts to ensure rural awareness and last-mile access for oral hygiene solutions.

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