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India emerges as top bet for FMCG giants

By Sohail Khan 12 September 2026, 12:00 am

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Business News›News›Economy›Foreign Trade›As China slows, global FMCG and consumer giants from L'Oreal to Nestle bet big on India

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As China slows, global FMCG and consumer giants from L'Oreal to Nestle bet big on India
Synopsis

India is becoming a key growth focus for global consumer companies. Rising incomes and expanding retail offer significant untapped market potential. Companies see opportunities to increase consumption and introduce new products. This shift occurs as China's growth moderates and mature markets show less room. India's large population presents a substantial long-term opportunity for expansion.

The collaboration is expected to support Isuzu’s export operations while further strengthening Kamarajar Port Limited’s role in handling automobile shipments, in line with the growth of India’s maritime trade and logistics sector. — As China slows, global FMCG and consumer giants from L'Oreal to Nestle bet big on India

Mumbai: India is moving from an emerging-market opportunity to a global growth priority for consumer multinationals, as China slows and mature markets offer limited room for expansion.

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.

Also read: Extreme heat creates new winners in India’s FMCG basket

"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 Bureau

Long game

The 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.

Also read: Coca-Cola CEO says don’t chase ‘irrational’ pricing as Campa Cola goes ₹10

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.

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