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As the demand for science-backed treatment picks, India becomes new ground for cosmeceutical start-ups
In the recent years, there has been a notable progress in India’s beauty and personal care industry. As the.....
- May 1, 2026
- Posted by: Admin
- Categories: Retail Sector
As the demand for science-backed treatment picks, India becomes new ground for cosmeceutical start-ups
In the recent years, there has been a notable progress in India’s beauty and personal care industry. As the country gradually transforms from an aspiration-led economy to a truly middle-income market, the demand for Beauty and Personal Care (BPC) products and other related categories such as fashion & lifestyle, nutrition, wellness etc. have significantly risen up.
Rise in discretionary income has equipped Indian households with deeper pocket to spend readily on BPC. Other factors such as sharp rise in digital distribution ecosystem and evolution of influencer driven marketing are further fostering growth.
India’s BPC industry is sized at around USD 30 billion (276,000 crores) with major segments comprising fragrances, colour cosmetics, skincare and haircare. Out of this the total size of the premium BPC sector is close to USD 1.2 billion (~ 4% of the total market size). Although it is still small compared to other emerging economies like Vietnam, where it is close 20-25%, the segment exhibits promise to grow.
A shift towards Precision, Science and Evidences
One of the notable progress in Indian BPC sector has been an underlying shift from generalist approach to a more science-backed and evidence driven one. Today many of us looking for a skincare lotion or serum want solutions to specific problems.
Buyers are now looking out for products rich in medical-grade ingredients that can solve specific problem(s), whether anti-ageing or wrinkles or acne. India has close to 46% of the population aged below 25 and these youths prefer to read the ingredient list properly rather than opting for blindfolded shopping.
These shifts are unravelling a market for cosmeceuticals, a new variant blending cosmetics and pharma together. Although in terms regulation, cosmeceuticals are marketed under cosmetic, they differ in composition. Cosmeceuticals are lab tested and leverage higher percentages of scientifically proven ingredients such as retinols, hyaluronic acid, niacinamides, vitamin-c, etc.
Unlike cosmetics, which are generally focused on overall skin or haircare, cosmeceuticals are precise in their approach. They are applied for specific type of treatments such as acne, wrinkle removals, anti-ageing, hair loss, pigmentation, etc. Close to 80% of the cosmeceuticals are directed towards derma/ skincare, while the remaining are mainly focused on haircare.
Factors Driving Growth of Cosmeceuticals in India
There are multiple factors that are driving the growth of cosmeceuticals in India
- Growth in per capita income: Indian economy is set to reach USD 7.1 trillion in GDP value by 2031 with an expected addition of 25 million of new affluent households followed by 75 million households. This will naturally translate into higher demand for BPC products.
- Information parity: As digital content has risen sharply in the form of fashion vlogs, lifestyle influencer-led contents, podcasts, there has been wide spread of medical-grade level information on personal care, fashion, wellness and cosmetics. Today even someone living in the hinterlands of India has access to quality insights on hair care, dermatology, etc.
- Rise of multi-faceted retail distribution: India’s fashion and BPC retail landscape is transforming. There are prominent mainstream channels such as modern retail, marked by speciality stores, exclusive brand outlets, shop-in-shop, pharma and salon chains. Similarly, the digital distribution ecosystem is evolving with the rise of D2C, market places and quick commerce.
- Emergence of D2C start-ups in Cosmeceutical Segment: Numerous start-ups have emerged in the segment, over the past 5-6 years such as Minimalists, Derma Tail, Fox derma, etc. who are pioneering the concept of science-backed and ingredient driven personal care.
- The Rise of Premium and Clean Ayurveda: Modern Ayurvedic brands such as Kama Ayurveda, Mama Earth, Forest Essentials are now shifting towards ingredient-rich clean products from traditional Ayurvedic remedies. They are blending the wisdom of traditional Ayurvedic herbs with modern lab-tested ingredient to create more focused, toxin-free product ranges.
- Mainstream Pharma Companies exploring the space: As the traditional lines between pharma & beauty care is blurring, many mainstay pharma like Cipla, Abbott, Dr. Reddy, Glenmark, Sun Pharma are entering the space. Due to the use of clinically tested active ingredients such as peptides, retinols, niacinamides etc. mainstay pharma are more well placed than traditional beauty companies. Unlike digital ecosystem and modern retail, these pharma companies rely more on OTCs and dermatologist-backed recommendation.
- The rise of Japanese & Korean Niche Brands: In India as the demand for efficacy and precision oriented advanced skincare is growing, niche Japanese and Korean brands are registering a spurt in demand. These brands offer affluent, clean and minimalist beauty solutions catering to the humid weather conditions of India.
- The B2B business: While less discussed in the media, this offers a robust revenue stream. For instance, Forest Essential, a clean Ayurvedic brand has tied up with major hospitality companies in India including Taj, Hyatt and Oberoi.
Cosmeceutical in India: Market Growth, Sizing and Trends
- The overall market size of cosmeceuticals in India is Inr 19,140 crores (USD 2.03 billion) in 2025, growing at a CAGR of 22.54% between 2022-25, as per the latest research conducted by The India Watch.
- The overall sector can be broadly split into 5 major players including pureplay D2C start-ups, speciality/ clean Ayurveda, derma arm of mainstay pharma companies, derma arm of personal care brands and others which includes niche brands, Japanese beauty, Koran beauty, etc.
- The derma divisions of personal care brands are the biggest contributor, managing close to 42% of the overall market. This segment is run by top brands such as Loreal, Cataphill, etc.
- This is followed by derma divisions of mainstay pharma companies such as Cipla, Dr. Reddy, Abbott, Sun pharma etc. which are now aggressively entering the medical-level ingredient rich skincare and haircare solutions.
- Recent years has seen emergence of pureplay D2C players such as Minimalist, Fix Derma, The Ordinary (Originally a Canadian brand), Dot & Key (part of Nykaa), Foxtale etc. which are growing at a scorching pace.
- The D2C players command a modest market of around Inr 2287 crores, around ~ 12% of the overall cosmeceutical market in India. However, this is one of the fastest segments, growing at a CAGR of 49.1% between 2022-25.
- The speciality/ clean Ayurveda holds close to 17% of the market, commanding a total value of around 3,329 crores. Major players in the segment include Kama Ayurveda, Forest Essentials, Mama Earth, Biotique, etc.
How The India Watch can Help
The India Watch is one of the leading market research, feasibility study and growth consulting companies in India. We assist business owners, start-ups, entrepreneurs and investors with tailormade insights, research and data to enable them make informed business decisions.
Though we are largely sector agnostic, we have strong understanding of the beauty and personal care segment including other related categories such as lifestyle, wellness, cosmetic and cosmeceutical sectors.
Our range of services includes but are not limited to the following:
- Market research studies
- Consumer research studies
- Market feasibility studies
- Product launch & viability studies
- GTM strategy
- Pitch decks and strategy decks
For any further information, feel free to drop us a mail at info@theindiawatch.com
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