India's beauty boom is running unabated. From a vast emerging market for beauty and personal products, India is now maturing into a beauty products manufacturing hub. ET has reported recently that Japanese luxury beauty products maker Shiseido plans to start manufacturing in India as it scales up, joining global peers such as Estee Lauder Companies and The Body Shop, which are also in talks with local partners to kickstart or step up production in the country and tap into the world’s fastest-growing market in the segment.
An executive at a Delhi-based cosmetics importer told ET that they have enquiries from two global celebrity-owned luxury beauty brands to find local partners to make in India. US’ Estée Lauder Companies, which owns Mac, Bobbi Brown and Clinique, and the UK’s The Body Shop, which sells imported cosmetics in India through its local partner Quest Retail, along with other global brands such as Kiehl’s, Avon, Kylie Cosmetics and Max Factor, too are said to be in the process of finalising manufacturing partners in the country. Estee Lauder, which has nine global production sites across the US, Europe and Japan, has already launched some limited-edition products made in India through a third party.
Economic, business and social factors are driving a beauty and personal care boom in India when China's consumption has dimmed. A large number of brands have entered India in recent times. The past year alone has seen luxury beauty labels Rare Beauty by Selena Gomez, Rihanna’s Fenty Beauty, Anomaly by Priyanka Chopra, H&M Beauty and Dubai’s Huda Beauty entering the Indian market.
From big and luxury brands to local startups, everyone is betting big on India as India's look-good market has never looked so good.
A predominantly young population, expanding reach of social media influencers, the reels culture, and a new generation which is open to experimentation are fuelling growth in India's beauty and personal care market. Dozens of beauty brands have popped in the past few years even as global giants begin to find promise in India and Indian retail giants snap up smaller brands which pitchforked into prominence through e-commerce. Add to all that the recent premiumisation of consumption in IndiaIndia which has seen the rise of a large number of luxury shoppers who are willing to pay the top dollar for products of reputed luxury brands.
The beauty and personal care segment is also more or less immune to the widespread urban consumption slump. Consumers may cut spending on essentials but still buy their favourite beauty and personal care products.
As e-commerce democratises the beauty business, beauty and grooming products are fast filling up the online space with more than 3,500 brands, according to a Redseer Strategy Consultants-Nykaa report. Almost 96% of them operate primarily in the e-commerce space. “Many brands are being launched every year, enabling new consumers to enter the beauty and personal grooming category at different price points or upgrade as well,” Sharang Pant, head of commercial, tech and durables, NielsenIQ India, has told ET early this year. “Online prices are cheaper by 10-30% versus offline for these products.”
Besides the growing emphasis on self-grooming by the youth as they spend significant time on social media, putting up their photos and reels, a clear shift in consumer behaviour, especially driven by Gen Z, is shaping the beauty and personal care market in new ways. Companies selling cleansers, moisturisers, serums and lotions with claims of being backed by dermatologists, are now drawing a younger consumer base, especially Gen Z users who are influenced by social media celebs.
These youngsters are far more conscious of what goes on to their skin, compared to millennials and Gen X. They no longer chase basic whitening or moisturising creams. That translates to hyaluronic gel as sunscreen, kojic acid to treat dark spots and pigmentation, and snail mucin with peptide complex for smooth and moisturised skin. It is not just that they know what to buy. They have educated themselves on how each active ingredient works on their skin, even at the granular level of being aware ..
A key trigger for this shift has been influencers-turned-beauty gurus popularising such ware through Instagram and YouTube. “These ingredients may sound too chemical but consumers are now aware and seek transparency on what is being sold. In food, consumers look for protein, fat and carbs content on the pack to understand its benefits. Similarly, they want an honest approach for their skin care too,” Mohit Yadav, co-founder of Minimalist, which has been bought by HUL, told ET last year. “Even now, we are surprised by the level of knowledge consumers have compared to a few years ago when the skin care regime was much simpler,” he added.
The Indian beauty and personal care market is poised to reach $34 billion by 2028, up from $21 billion now, driven by a surge in online penetration and a growing preference for high-quality, premium beauty products, according to a report by Nykaa and consulting firm Redseer released last year.
The online channel, as the fastest-growing segment, is expected to expand at a compound annual growth rate (CAGR) of approximately 25%, while the organised offline channel is anticipated to grow at 14%. The ‘Nykaa Beauty Trends Report’, released a few months ago, noted that rising discretionary spending, fuelled by increased disposable income, expanded e-commerce access, and product innovation, are some of the other key trends driving momentum in this sector. Rising aspirations and higher incomes among Indian consumers will propel the market for premium beauty, expected to reach $3-3.2 billion by 2028, it said. Further, it highlighted a notable shift in consumer demand from personal care to beauty products in India, comprising skincare, makeup, haircare and fragrance categories.
India’s luxury beauty products market is estimated to expand to $4 billion in sales by 2035, from $800 million in 2023, at a time when China is facing economic headwinds and dampened consumer spending in the segment, according to a report by consulting firm Kearney, along with luxury products retailer LuxAsia.
India's expanding e-commerce sector has led to democratisation of the market and explosion of brands which is truer for the beauty and personal care segment. As e-commerce removed the high entry barriers which existed in offline retail and Gen Z opened up to experiment with new products as well as sought more personalised ones, India witnessed an explosion of beauty and personal care brands.
Homegrown direct-to-consumer (D2C) beauty and personal care brands are continuing to attract investors despite the expanding footprint of global brands in the domestic market, as per a recent ET report. The total funding raised by 20 leading D2C brands including Sugar Cosmetics, Innovist, Fae Beauty and Renee Cosmetics increased 7% from a year earlier to $63.1 million (about Rs 560 crore) during January to September 2025, per data from business intelligence firm Tracxn.
Notably, total funding raised by these brands so far this year marks a nearly threefold surge from $21.6 million in 2020. "On an average, investing in the beauty category, given its high margins and capital efficiency, can return 10 to 25 times the investment. You can see that level of return with the investors behind Minimalist and Mamaearth," Arjun Anand, managing director & head of Asia, Verlinvest, a Belgium-headquartered investment firm, told ET. "This is not the case with most other consumer categories. And this is being driven by consumption, premiumisation and democratisation."
Big companies are buying smaller D2C brands which have managed to carve an online niche for themselves. Hindustan Unilever (HUL) acquired 90.5% of Minimalist, a homegrown skin care brand, for Rs 2,706 crore while Marico bought Beardo for nearly Rs 400 crore and Emami acquired The Man Company.
Source Name : Economic Times