Speaking during the firm’s 2022 annual earnings conference held recently, CEO Nicolas Hieronimus highlighted the firm’s lofty ambitions In India.
Considering its current performance in India and the market trends, Hieronimus expressed that the market could surpass EUR1bn (USD1.1bn).
“We have only two divisions over there and we already have an 8% market share. It's actually over 10% if you take e-commerce, which is our main growth driver. So, from a EUR500 million business today, I think we can take it to EUR1 billion in the next foreseeable future.
“We have high ambitions. Statistics say that by 2030, India will represent 20% of the world's population and 30% of the qualified workforce. So, it will definitely be a driver of growth for us.”
L’Oréal’s growth in India so far has been attributed to the firm’s consumer products division (CPD), which consists of household names such as L’Oréal Paris and Maybelline.
Alexis Perakis-Valat, president of L’Oréal CPD, highlighted the strength of L’Oréal CPD’s division in India in the past year, which grew two times faster than the market.
He added that India was driven by the middle-class demographic and “rapidly growing into a beauty epicentre”.
“In India, 50% of the mass beauty spending is done by consumers that fall in the top two socioeconomic classifications. But in our division, 70% of our business comes from this upper half of the Indian middle class, which will fuel the market growth for years to come,” he said.
“I think what's interesting is to look at this upper part of the Indian middle class, which is today, let's say 200 million to 300 million people, but is set to double in the next five to 10 years. So that's very exciting.”
Furthermore, India’s beauty market was ripe for expansion, said Perakis-Valat.
“I've seen changes in the last two years like never before in terms of – in terms of sophistication of the market, in terms of change of the distribution, thanks to e-commerce. All that powered by a super digital ecosystem. So, we're very, very bullish about India.”
Hieronimus agreed but noted that the market still had room for advancement.
“I was in India two months ago and I was really impressed by the growth, the development, and the accelerated sophistication of this market. It's still not as developed as we would like in terms of distribution, but it's really accelerating, and our shares are growing.”
While India was an exciting prospect, Hieronimus believes India’s beauty market was not similar to China.
He concluded: “I think there are two very different markets. I don’t think India will ever look like China, but it's still a very promising market for us… So, very excited about India, but I don't think it will be like China.”