Beauty products will be “a key focus for us” from now on along with footwear and underwear, Noel Tata, non-executive chairman of Trent Ltd., a Tata Group entity operating a chain of retail stores, said in an interview at his office in Mumbai. “Expanded product line and experimentation with formats for these products is on the way as we see these as growth areas in the retail trade.”
India’s cosmetics and beauty market is estimated to almost double in 2025 from $ 11 billion in 2017, according to data from Statista, supported on a good scale by online retailers led by Mumbai-based
who experienced a blistering growth during pandemic. The startup, which is now a $ 13 billion company after a grand IPO, helped millennial and Gen-Z consumers buy high-end beauty brands as well as access tutorials and testimonials from influencers on social media.
It is far from the beauty sector, India’s largest business house dominated decades ago. Simone Tata, Noel Tata’s mother, helped create Lakme – the French name for the Indian goddess of wealth, Lakshmi – in 1953 as the country’s first cosmetics company. The group sold it to Unilever Plc’s local unit in 1998. While the coffee-to-cars conglomerate re-entered the turf in 2014, long after the 10-year non-compete clause had expired, it is only now that the group has begun to raise its play again.
Revenue from the beauty, footwear and underwear category is only about $ 100 million for Trent, while the market is at about $ 30 billion now, according to data provided by the company.
“These three segments would be low-hanging fruit for Tatas at a time when they are aggressively expanding stores and distribution channels,” said Kranthi Bathini, stock strategist at WealthMills Securities Pvt. “While competition is high in these segments, the cake itself is growing rapidly as consumption returns to the economy.”
The $ 103 billion conglomerate, under Trent, is considering building new lines of in-house cosmetic brands that could be a means of growth, Tata said. These products can be sold through existing large stores under Westside – Trent’s flagship chain of retail stores – or through independent stores and through digital channels, he added.
Noel, half-brother of Ratan Tata, is one of the trustees on the board of Ratan Tata Trust, which is part of a charity that owns two-thirds of the shares in Tata Group’s main holding company. He has overseen the group’s retail business, which is mainly housed in Trent for more than two decades.
Indian women were used to buying makeup and hair care products in mom-and-pop stores where the selection was poor and trials unheard of. With the proliferation of malls and supermarket chains and more recently the online stores, the sector has transformed into a fast growing one, especially the three segments that Tata is targeting.
“I feel that we have barely scratched the surface in these categories and a significant part of these markets are still disorganized and there will definitely be a shift to organized retail. We are also seeing a shift in consumer behavior and prefer more fashionable products in these categories, ”Tata said.
The shares in Trent, founded in 1998, have risen more than 9 times under Tata’s management since 2014, surpassing peers Aditya Birla Fashion and Retail Ltd. and Shoppers Stop Ltd. In November, he switched to a non-executive role in Trent.
“I can see the digital opportunity that helps us reach more customers no matter where they are,” Tata said, whether it surfs and buys online or in a physical store.
Trent has been an early adopter of the omni-channel model in Indian retail with TataCliq and has recently increased its online presence with Westside.com. A super app that Tata Group is developing will expand access to customers, he said.
But Tata’s retail business will stay away from the e-commerce giants’ deep discount strategy, including Amazon.com Inc and Flipkart Online Services Pvt. to lure price-conscious buyers, Tata said.
About 90% of Trent’s total sales are at full price, according to data provided by the company.