Fragrance-makers smell ample opportunities

V Rishi Kumar Hyderabad | Updated on January 09, 2018

Raw materials for fragrances are natural extracts, plant extracts, oils and synthetic aromatic chemicals SHUTTERSTOCK

FMCG sector, rural India boost demand

While fragrance is thick in the air, its industry is abuzz with excitement, gearing up for new opportunities.

The country’s ₹15,000-crore fragrances and flavours market is witnessing buoyant times with consumption demand going up in the FMCG sector, rapid penetration in the rural market, and growing acceptance of Indian items in the global market.

Market growth

Rishabh C Kothari, Vice-President of Fragrances and Flavours Association of India, a representative body of over 1,000 manufacturers, says the domestic market has grown between ₹8,000 crore-10,000 crore, of which, mint alone is estimated at ₹4,000 crore. Exports account for about ₹5,000 crore.

“The market for industrial fragrances, which go into end products, from toothpaste, talcum powder, soaps and agarbattis, and flavours that go into food items, have been driven by several factors – the growth of the FMCG sector in the country, affordability for products in the rural parts of the country and growing acceptance of Indian materials in the global market place,” Kothari, who is also the Director of Kolkata-based CKC Fragrances and Flavours, told BusinessLine.


Take the case of detergents whose function is to simply clean.

Now, there is been big change in the way they are sold, with nine out of 10 detergent-makers focusing on fragrance as part of their marketing strategy.

The industry has been mostly unorganised, with most of the companies in the small and medium segment. If the current trends are any indication, this segment is set to become a much bigger market.

Raw materials for fragrances are natural extracts, plant extracts, oils and synthetic aromatic chemicals.

The oil extract from rose is about ₹7-8 lakh per kg and jasmine ₹2 lakh a kg. In the case of cinnamon, every part of the plant is used for different purposes.

“Take the case of the deodorant market in the country, which was non existent a few years ago. Current estimates put it at more than ₹5,000, with one player alone accounting for ₹1,000 crore-plus turnover. It is like the shampoo segment, which was kicked off by Chic sachets, making it affordable for everyone,” he explained.

“Likewise, in India, fairness cream has evolved as a major category, and now we have the men’s fairness cream business, which itself has grown to be a big market. Several new categories are getting created, such as room fresheners and car fresheners, all adding up to demand and volumes in fragrances business,” he said.

The per capita consumption in the FMCG sector is amongst the lowest in India, with some estimates putting it lower than Sub-Saharan Africa. As the economy grows, it is poised for growth.

CKC Fragrances

In tune with the growing requirement, CKC Fragrances is in the process of setting up another manufacturing unit in Kolkata to expand its business.

“We supply to some of the major manufacturers, including to Patanjali. Our new plant is aimed at meeting such demand,” said Kothari.


Published on December 08, 2017

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like