Executive Summary

The FMCG market is the forth-largest sector in the economy with a total market size inexcess to $
12.1 billion. It has a string MNC presence and is characterized by a well-
established distribution network, intense competition between the organized andunorganized segm
ents and low operational cost. Availability of key raw materials,cheaper labor costs and presence
across the entire value chain gives India a competitiveadvantage. The FMCG market is set to treble
from $11.6 billion in 2003 to $33.4 Billionin 2015. Penetration level as well as per capita
consumption in most product categories islow indication the untapped market potential. Burgeoning
Indian population, particularlythe middle class and the rural segments, presents an opportunity to
makers of branded products to convert consumers to branded products. Growth is
also likely to come fromupgrading in the matured products categories.

Hair care increases by 18% in current value terms in 2012, to reachRs116 billion

Consumers’ willingness to spend more and try salon hair careproducts at home aids value growth

Colorants sees the fastest current value growth of 29% in 2012

Average unit prices increase as manufacturers offer value-addedbenefits

Hindustan Unilever leads hair care with a 17% value share in 2012Over the forecast period hair care
is expected to increase by aconstant value CAGR of 10% to reach Rs185 billion

The hair oil market is huge, valued at Rs 6 bn. Due to the varied consumption habits of consumers
across the country, where coconut oil and edible oil are interchangeably used,the size of the market
is likely to be higher than estimated. More importantly, the marketis growing at an impressive 6-7%
in volume terms despite the high penetration level.Usage of hair oil is a typical Indian traditional
habit. It is perceived to offer benefits of nourishment, hair strengthening, faster and better growth,
and reduce the problem of falling hair. There are two types hair oil available in the market; coconut
oil and non-greasy perfumed oil. Coconut oil comprises 2/3

rd

of the total market and the balancecomprises the non-greasy perfumed oil.Usage of hair oil is an
everyday habit with 50% of the population out of which
some perceive that massaging the head with hair oil has a cooling impact. The penetration of hair oil
is fairly high at around 87% and evenly distributed among the urban and ruralareas.The coconut oil
market accounts for 72 per cent share in the hair oil market. In
the branded coconut hair oil market, Marico (with Parachute) and Dabur are the leading players. The
market for branded coconut oil is valued at approximately $174 million.