At the Barclays Global Consumer Staples Conference in Boston this week, top executives from nearly a dozen companies including Mondelez, L’Oreal, Nestle, Colgate-Palmolive, Reckitt, Yum Brands, Unilever, Philip Morris and Danone pointed to India’s low consumption, rising incomes and expanding retail ecosystem form a huge opportunity to tap.
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“India is one of the large markets for future openings,” said Jacek Olczak, chief executive of tobacco company Philip Morris, pointing to the scale and economics of the market. For Brown-Forman’s finance chief James Peters, India has the potential to follow Brazil, where years of investment eventually turned the country into a major market for the maker of the Jack Daniel’s whisky.
The size of the market is evident in India’s still-growing consumer sector, although near-term demand remains uneven. The organised FMCG sector is expected to grow 8-10% in revenue in fiscal 2027, slightly ahead of the roughly 8% growth in FY26, according to Crisil Ratings. The growth, however, is expected to be largely price-led, with volume expansion projected to moderate to 2-3% from 5-6% last year, as inflation weighs on urban and rural demand and a below-normal monsoon poses a risk to rural consumption.
ET BureauThe opportunity is particularly evident in categories where Indian consumers still consume far less than their counterparts elsewhere.
In emerging markets where per-capita consumption is already high, companies can push premium products, while in markets where consumption remains low, the opportunity is to get consumers to use more, said Noel Wallace, CEO of oral hygiene company Colgate-Palmolive. India falls firmly into the latter group, he said.Global companies said they have several levers to pull, such as bringing new consumers into a category, increasing the frequency of consumption, moving shoppers towards premium products and expanding distribution.
Emerging markets offer substantial room to establish consumption habits that are already mature elsewhere, Mondelez executives said. Among them, India and Brazil stand out.
In India, the snacking and confectionery corporation has been pushing premiumisation through brands such as Cadbury Silk while expanding distribution and investing in channels such as quick commerce.
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The company supplies to about 3 million of the estimated 9-10 million Indian stores, leaving a large distribution gap to close. It is also finding demand for new products. Chief operating officer Luca Zaramella said its new biscuit line in India sold out within six months, prompting the addition of another production line.
The same dynamic is playing out in beauty. L’Oreal reported India growth of 17%. In the South-east Asian region, including India, dermatological beauty and professional products are growing more than 20%, while ecommerce is expanding about 40%.
For Dettol maker Reckitt, India routinely delivers high-single-digit to low-double-digit growth, with CFO Shannon Eisenhardt describing the country as an “incredible execution engine” with considerable scope to increase reach. The opportunity is also forcing companies to rethink where growth will come from as China becomes a less dependable engine.