Estée Lauder Companies, L’Oréal Group, and Puig are increasing their investment in the Indian beauty market. It’s rich with opportunity for those who get it right.
Many of beauty’s leading conglomerates have their sights on India for 2026. This month, Estée Lauder Companies took full ownership of India n ayurvedic-led beauty brand Forest Essentials. In January, Unilever led a $3 million seed funding round for the India n clean perfume brand Secret Alchemist.
And according to recent reports, L’Oréal Group is weighing a minority stake investment in Indian personal care company Innovist. ELC’s recent acquisition of Forest Essentials marks the first M&A move made by Stéphane de La Faverie, the group’s president and chief executive officer, who joined in January 2025. The company first invested in Forest Essentials in 2008, upping its stake to 49% in 2020. “This next phase of partnership reflects our long-term commitment to India — one of our largest and most significant emerging markets,” he said. “Together, our ambition is clear: to further strengthen the brand’s leadership at home while thoughtfully introducing it to a global audience.” India is currently the world’s seventh largest beauty market, according to Euromonitor, and is on track to grow 37.2% to $27 billion by 2029. According to a McKinsey survey of beauty executives, 78% believe India is the beauty market with the largest growth potential. There are a few factors at play: a growing population of young people and the middle class, digitization, and the explosion of smartphones. According to McKinsey, India now makes up 40% of total global internet transactions, while the number of smartphones in the country surpassed one billion in 2024. “India is growing at a fast pace — beauty as well as the broader economy — with ample runway to grow in terms of per capita spend and consumption, driven by positive demographic and macro factors,” says Sara Hudson, a partner at McKinsey. “Zooming out, it is also growing at a faster pace than other markets, including those that used to drive lots of growth for global beauty players such as China.” Conglomerates are earmarking emerging beauty locales such as India as they navigate headwinds in other key geographies. In China, Western beauty brands are in a slow recovery period following a downturn in travel beauty retail and softening consumer sentiment. Meanwhile, the Middle East will see the impact of its ongoing conflict on beauty’s outlook for fiscal 2026, according to analysts. India is ripe with opportunity. Many beauty consumers today — tired of wellness tracking and self-optimization — are increasingly turning to ancient healing practices that allow them to be more in tune with the natural rhythms of their bodies. Ayurveda, the ancient Indian medical system that relies on a “natural” and holistic approach to physical and mental health, is gaining traction globally. With a growing domestic beauty market — and a growing appetite for Indian, ayurvedic beauty in the West — India’s potential is twofold. Conglomerates can scale their Western brands in India, with greater understanding of the consumer, while the Indian labels they acquire can grow beyond their domestic market. The Indian beauty space is currently led by mass brands like Dove and Lakmé. The mass-market category witnessed 8% growth from 2019 to 2025, while the masstige market is growing at 13%, per McKinsey. Omnipresent beauty Since the pandemic, India has amped up its e-commerce operations. Beauty brands and retailers now deliver to every corner of the country, serving millions of customers, to meet growing demand for beauty e-commerce. Leading beauty retailers Purplle, Tira Beauty, Myntra, and Kult, now deliver to Tier 2 and 3 cities, like Amritsar, Chandigarh, and Lucknow or Bathinda, Cuttack, and Udaipur . According to Nykaa, India’s leading beauty and fashion retailer, 60% of revenues come from Tier 2 and 3 cities, led by young consumers. “The average age in India is still under 35. Gen Z and Alpha are demographics that beauty companies are targeting as they’re more online, their taste in beauty has quickly evolved and they’re driven by trends,” says Tanya Rajani, Mintel’s associate director of beauty and personal care in India. According to Mintel, despite a growing digital beauty landscape, the number one source of influence for Indian consumers is friends and family, followed by product reviews on Amazon and other beauty retailers. But bricks-and-mortar shopping experiences remain important. “The majority of Indians still purchase their products in-store and therefore the store assistant plays a very important role of influencing the consumer they’re guiding, educating, and encouraging,” says Rajani. Forest Essentials captured the attention of ELC early on because of its high retail penetration across India. The brand now has 1,930 standalone stores in the country, supplies products to 190 hotels, and ships to 120 countries. In 2021, the brand began expanding its digital footprint to the US, the UK, the Middle East, and Southeast Asia. “Getting that omnichannel approach is something that brands need to keep in mind when looking at India,” says Rajani. Understanding the market Ayurveda-led beauty has become a gateway for Indian brands to appeal to domestic and international consumers. But the sweet spot is ayurveda backed by science, which brands like Forest Essentials have leaned into. “Indian consumers believe in efficacy and clinically tested products. They want their beauty products to have research and technology, which is something Forest Essentials have done really well,” Rajani says. To win market share over well-known Western labels, domestic brands have focused on communication and storytelling. “Especially in haircare and skincare, successful local brands oftentimes appeal via convincing communication on superior quality formulations that are efficacy-focused and science-driven, and higher perceived value for money with greater care than foreign brands at similar price points,” says McKinsey’s Hudson. In 2019, Puig took a minority stake in Indian ayurvedic beauty and wellness brand Kama Ayurveda, which specializes in skincare, haircare, and bodycare. And if the recent Puig-ELC merger discussion comes to fruition, there’s an opportunity for the beauty giants to take significant Indian market share. Kama Ayurveda has since been investing in technology, and in 2024, partnered with AR and AI-provider Holition Beauty to introduce an AI-yurvedic Skin Scan that determines a user’s dosha . The consultation provides customers with a personalized beauty, dietary, and movement plan that they would otherwise would have to book an in-person appointment for. “When Puig took a minority stake, it was really about our authenticity and long-term vision. They saw that we’re rooted in genuine ayurvedic knowledge and recognized the potential of ayurveda as a global luxury category,” says Kama Ayurveda founder Vivek Sahni. “What resonated was our focus on hero formulations like kumkumadi , our balance of tradition, science and sustainability, and our rigorous approach, particularly our investment in clinical trials to validate efficacy.” Since Indian ayurvedic haircare label Champo launched in 2019, it has sold over two million products, with one of its hair regrowth-targeting Pitta Growth Serums selling every 15 seconds, says founder Kuldeep Knox, who started out as an analyst at Neo Investment Partners, the British backer of Victoria Beckham and Ami Paris. Champo’s ayurvedic ingredients — myrobalan fruit extract, gum arabic, and geranium oil — resonate with a consumer seeking easy packaged haircare, rather than performing weekly ayurvedic hair oiling that can take up to an hour. “It isn’t easy to buy ayurvedic products and know how to do the rituals — people were wanting it packaged in a way that could really fit into a busy lifestyle. rituals and oilings aren’t necessarily catered to the needs of modern women,” she says. The brand launched in Harrods in July 2021, and in 2023, it joined Selfridges, as well as 130 Sephora stores across 14 countries. The brand’s key markets are the UK, France, Italy, Germany and the US, the latter of which is its fastest-growing market and grew by 400% in 2025. Knox has found storytelling to be a key pillar in her brand’s marketing. “Being able to translate Indian cultural heritage on a global scale is very important, and that growth is coming from people really wanting domestically influenced brands like ayurveda and high-quality natural ingredients that have been clinically tested,” she says. If L'Oréal Group’s investment in Innovist goes through, it would make the French conglomerate one of the leading players in the Indian market, Rajani says. Innovist’s portfolio is made up of successful Indian haircare brand Bare Anatomy, skincare brands Chemist at Play and Sunscoop, and bodycare brand Vinci Botanicals. “Innovist is focused on education, and they talk about ingredients, science, and technology,” says Rajani, flagging that safety is a number one concern for Indian consumers. She notes a recent L’Oréal Paris campaign, where the brand launched its Glycolic Bright Serum in India, with billboards featuring big, bold letters reading “tested on Indian skin types”, which is a good example of how to secure the local consumer. L’Oréal Group is also operationally investing in India. In January, the company announced it would be launching its first global tech hub in the country, investing more than €350 million to focus on AI-powered beauty innovation and services. For Western labels, localization is key to success. For example, the K-beauty glass skin trend that’s surged in the West hasn’t resonated the same with Indian consumers, because it doesn’t translate to the country’s weather conditions and humidity. “If we tried it, we would really look quite sweaty,” says Rajani. “That’s where the gap in the market is — Indians want that global hype, but it also needs to make sense for them.” Forest Essentials founder and chief managing director Mira Kulkarni says that ELC gave the business access to operational rigor when they went into partnership in 2008, but as a brand, they made a clear decision to concentrate on India first. “We would not expand internationally until the home market was truly established — that discipline, I believe, is one of the reasons the brand has the credibility it does today,” she adds. Looking ahead, we can expect further investment in Indian beauty, on a domestic and international level, experts agree. “The future for the Indian beauty market looks strong, but the market still needs a lot of handholding and guidance. In five years time, we will be more involved and knowledgeable,” Mintel’s Rajani says.
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