India has one of the youngest populations in the world, with 305 million people under the age of 12 as of 2015. Of these, 50 million are less than two years old. The baby care sector grows 17% annually, projected to reach $31 billion by 2019. The country’s child and baby care industries comprise of cosmetics, food, diapers, apparel and footwear, toys, and accessories.
Baby apparel accounts for a significant portion of the market and is growing more than 10% annually. As children’s clothing for middle class India evolves from utilitarian to fashionable, foreign brands are increasingly prominent. Walt Disney partnered with India’s Vox Pop Clothing to produce children’s clothing based on Disney characters. Domestic brands are also gaining popularity–Lilliput Clothing, Gini & Jony, and Mom & Me are prevalent among urban mothers.
Disney also plays a major role in the country’s $1.3 billion toy market. Disney products are manufactured by Funskool India, a joint venture between Rhode Island-based Hasbro, Inc. and India-based MRF Limited. Funskool is the biggest toy company in India with 16 warehouses supplying 4,000 retail locations. Mattel is also a prominent figure in the toy industry; its Indian Barbie and Hot Wheels are popular among Indian youth. Mattel releases new products almost every few months.
New-Jersey based Johnson & Johnson has the strongest presence in child- and baby-care toiletries such as shampoo, lotions, and powder. Headquartered in the northern state of Uttar Pradesh, Dabur India specializes in massage oils and dietary supplements for children. Unicharm Corporation, a Japanese chemicals manufacturer, invested $39 million to set up a facility for the production of baby care and personal care products in India. Procter & Gamble and Texas-based Kimberly-Clark are also major contenders. The diaper category is dominated by P&G’s Snuggies and Kimberly-Clark’s Huggies, produced through a joint venture with Hindustan Unilever.
The baby food subsector in India is expanding due to the increasing number of women in the workforce. As a result, there is a shift from traditional homemade foods to baby food formulas, especially those that are milk-based. The leaders of this subsector include Nestlé, Wockhardt, and Heinz. Nestlé holds 85% of the baby foods segment, and its brand Lactogen is trusted by middle class mothers nationwide.
Due to increasing health consciousness, there is a great demand for organic baby care. Indian firm Gron Stockholm launched three new organic kidswear stores and is planning to establish 25 additional locations in Mumbai, Kolkata, Chennai, and Bangalore. Organic baby foods are also gaining popularity; in 2014, a third of baby food product launches were organic. India-based British Life Sciences, the baby care division of British Biologicals, specializes in organically-grown and pesticide-free baby foods. This firm also launched Mum’s Care, the country’s first organic baby cereal.
E-tailers in India such as Flipkart, Snapdeal, and Amazon are major players in the baby care sector. The share for online baby care products is projected to increase to $500 million in 2017 from $100 million in 2014.
As India’s population grows, so do the opportunities in its baby care industry. For companies that provide quality health-conscious products, the possibilities to invest in India are promising.
