As premium personal care booms, ITC stays measured on acquisitions

ITC’s older personal care acquisitions, including Savlon, which it bought in 2015, and Nimyle, which it bought in 2018, have grown to six to seven times their original size, Satpathy said. But unlike listed rivals such as Hindustan Unilever and Marico, ITC is in no rush to acquire independent brands that are mushrooming in niches in India’s burgeoning personal care market.

“The growth potential in personal care categories is huge,” Satpathy said. “Some new brands are entering categories, but not everyone can survive.”

India’s personal care market was last estimated to be worth $21 billion in 2023 and is expected to reach $34 billion by 2028, according to a report by beauty retailer Nykaa and strategy consulting firm Redseer. While the overall market is growing at a compound annual growth rate (CAGR) of 10-11%, online channels are expanding much faster at around 25% CAGR.

Selective bets

ITC’s personal care investments so far have been limited to baby care brand Mother Sparsh and Mylo, an app that offers content and products for pregnant and new mothers. ITC acquired 10% stake just below ₹40 crore in Mylo in 2022 and is investing in Mother Sparsh in tranches since 2021. In April last year, it agreed to acquire the remaining shares of Mother Sparsh later this year. In total, ITC would invest ₹126 crore to acquire the company.

“When we buy a brand, the question is: Can we give it the time and attention it needs?” said Satpathy. “You also have to make it clear why you’re acquiring something: Is it for control, or is it because the acquired brands are in white spaces with unique powers in areas where we may not have the bandwidth or capacity to do what they want? [the acquired brand] are you doing? “We always prefer the second strategy.”

ITC was the first and only institutional investor in Mother Sparsh, which launched with a Series A round in 2021. The company was founded in 2016.

“We have been clear about why we fall into certain categories,” Satpathy said. “Baby care is a segment we are looking at and investing in through start-ups. We think baby care is a category that runs on overconfidence and is difficult to do consumer trials. So a business of scale here is very valuable in a very high margin category as it has a natural moat.”

As of FY25, Mother Sparsh reported revenues just below 2020 ₹100 crore, an increase of more than six times compared to FY21, while losses in FY25 remained in February: ₹13.2 crore, according to data from research platform Tracxn.

Peers move faster

ITC’s limited acquisition strategy is in sharp contrast to listed rivals such as Marico and Hindustan Unilever, which have actively invested in or acquired digital-first brands targeting premium personal care niches.

Marico’s digital brand portfolio intersects ₹1,000 crore revenue has been generated and is growing at a CAGR of 25%. The biggest digital-first personal care brands include Beardo, which Marico first took a stake in 2017 and acquired outright in 2020.

The company has since invested in nutraceutical brand Plix and herbal and ayurvedic cosmetics brand Just Herbs. ₹100 crore revenue was generated last year, according to brokerage firm Emkay’s note dated December 2025.

“Management remains committed to doubling its revenue over the next five years and becoming a globally recognized digital FMCG company (ranked No. 2 in India after Honasa),” the note said, referring to the parent firm of D2C pioneer Mamaearth. It was said. “This will be supported by actions on new growth engines (20-25% CAGR) that gradually embrace emerging consumption trends.”

Premium personal care now accounts for 16-17% of Marico’s consolidated sales, according to a note JM Financial estimated earlier this month.

Hindustan Unilever was also active and slightly above its expenses. ₹2,700 crore to acquire skincare brand Minimalist in an all-cash deal last year; one of the biggest exits for the founders of an independent Indian brand.

While Hindustan Unilever maintains its market leadership in core categories such as soaps, Wipro Consumer Care and Godrej Consumer Products also have a significant share. Although it ranks second in the shower gels market, it remains a relatively smaller player in the soap segment, ITC’s Fiama said in its 2023 investor day presentation, underlining its limited scale in the mass personal care space.

Savlon, one of ITC’s largest personal care brands, has approximately ₹1,000 crore in consumer spending, while Engage ranks second in the fragrance market behind Vini Cosmetics’ Fogg.

ITC’s cautious stance on personal care contrasts sharply with its own food division, which has been on an acquisition spree. Last year alone, ITC acquired stakes in meat brands Prasuma and Meatigo and acquired organic staples brand 24 Mantra. ₹472.5 crore.

In pursuit of value

Satpathy said ITC’s conservative approach has not hindered scaling across online channels. E-commerce platforms now account for 25% of the personal care division’s total sales, while premium brands account for approximately 43-44% of the portfolio by value.

“There are now two different levers of growth, the top of the pyramid and the base of the pyramid,” he said. “With the recent reduction in GST rates, which is a far-sighted reform from the government, both engines now need to be engaged.”

Shares of ITC have been under pressure since the government announced that it will impose an additional excise tax on cigarettes, on top of the existing 40% GST, effective February 1. The stock has fallen more than 20% in the past month as analysts expect the company to pass on its higher tax burden to consumers.

ITC’s FMCG (Others) business, which includes food and personal care, reported revenue of: ₹11,859.56 crore in the first half of FY26 and ₹22,015.12 crore in FY25. By comparison, Marico reported revenue of over 100,000 ₹6,700 crore in the first half of FY26, while Hindustan Unilever’s revenues stood at February: ₹33,103 crore in the same period.

Despite the shock in the cigarette business, ITC’s other FMCG segments are yet to realize the bulk of the valuation, with food adding more value than personal care. In a note earlier this month, JP Morgan’s stock broking arm assigned a 6x EV/sales multiple to ITC’s Other FMCG business; which is “broadly in line with the coefficients of other food counterparts.” The brokerage values ​​ITC’s cigarette business at 11x EV/Ebitda, paper and packaging at 15x and agriculture at 10x.