Gujarat: The scent of success

As young Indians, riding on a cloud of aspirations, new experiences and more disposable income, lead the boom in India’s burgeoning perfume industry, the air in Gujarat is becoming intoxicatingly rich with opportunity.

Much like a masterfully blended fragrance, the industry is multilayered, and businesses in the entire value chain — raw materials suppliers, formulators, bottlers, glass bottle manufacturers, packagers and distributors — are riding the scent of success.According to an Imarc report, India’s perfume market, valued at a dizzying $1,184.0 million in 2024, is set to soar with a CAGR of 5.58%, reaching a staggering $1,958.2 million by 2033.

Cities like Mumbai, Pune, and Ahmedabad are emerging as fragrant epicentres.In the words of Kamlesh Shah, an elected member of the Fragrance and Flavours Association of India (FAFAI), “This is just a precursor. The average per capita usage of perfumes in India is still quite low. If people start layering perfumes – wearing them on the body, inner wear and on external clothes – the market will witness a 100% growth.”

Giving an even broader glimpse of the industry, he says. “India is the only country with 5,000 perfumery companies of which 2,000 are branded incense manufacturing companies who also make perfumes.

And naturally so. We have the tech, raw material and skilled people. At least 20 multinational companies have factories in India. Japan’s Takasago, International Flavors & Fragrances (IFF) of the Netherlands, and Mane are some that manufacture and bottle in Gujarat,” he says.

PERFECT BLEND, HEADY GROWTH

Gujarat has all ancillary units related to the industry, from glass bottle and cap manufacturers to fragrance makers, packagers and printers, catering to established domestic and international brands, and to those coming in to dabble.

In early Oct, Zetts Cosmetics, an industry giant which offers end-to-end design and manufacturing of fragrances for top domestic and international brands, operationalised its factory in Bavla, the company’s second footprint in Gujarat.“The current generation is fascinated by the new smells being launched. In 10 years from now, India will have a couple of its own international fragrance labels,” says Sanjay Punatar, its CEO, who has been in the business since 2004. “Our new plant is proof of the pudding,” says Sanjay, who, just a few days before its opening, was in France picking scents.

“We are not contract fillers. We develop the fragrance of our clients’ choice and deliver the finished product, complete with packaging.” Why Bavla? “Our plant in Kandla freezone is just around six hours away. Ahmedabad has easy connectivity to Mumbai, where our head office is, and to international locations via flight. The bullet train too is starting, and skilled workers are available,” says Sanjay.“Some local scents can be bought for 15-20% of the cost of an international perfume.

Besides, foreign brands do not formulate keeping India’s climate in mind; most such fragrances wear off quickly,” says Pratik Agrawal of Sugandh Vatika in Ahmedabad, adding, “Indian brands are filling this gap and Gujarat is where they are setting up shop.” Agrawal puts the growth in the past seven to eight years at around 25% annually; his 29-year-old brand has expanded its perfume range from 15-20 earlier to close to 150; extraits priced as high as Rs 11,000 for 100ml.“Plus, there is fair practice, and the investment climate is conducive. The state is also a better nodal point logistically,” says Chirag Dave, business manager at Cosmella Infinity Pvt Ltd, which has been making aerosol products and perfumes since 2008 for international brands, and exports to the Middle East, Africa and Europe.Cosmella has two facilities in Santej – one for production and filling, the second for packaging and storage.

A third, an Air Handling Unit, is coming up over 1,20,000 sq ft. “Our monthly filling capacity for deodorants is 15 lakh units and 5 lakh perfume products,” he says.Elite Fragrances Corporation, a B2B company in Changodar that makes compounds used in everything from fine fragrances to floor cleaners, has seen sustained growth. Shalin Sanghvi from the company says, “Key ingredients like patchouli, lavender, mint and geranium oils are sourced from countries like Indonesia, France, China etc and rich-quality jasmine and rose oils come from India.”

THE BEST, BOTTLED

As important as olfactory transcendence from a perfume is its bottle and packaging. Little wonder then that such units are heady with success.“We have one of the world’s largest production capacity dedicated to cosmetics and perfumery, and are amongst the top five players in the global premium+ cosmetics and perfumery market. The company has two plants in Gujarat – one in Kosamba (a centre for excellence for cosmetics and perfumes with a capacity of over 500 tonnes per day for cosmetics and perfumes), and the second in Jambusar,” says Anshul Gupta, senior manager, PGP Glass, which has captured a lion’s share in India’s glass bottles industry and is headquartered in Mumbai.“Our cosmetics and perfumery lines are fungible to make products like perfumes, skincare products, nail polishes, and room fresheners,” he adds.“With more than 50% of PGP’s revenues coming from overseas markets, the thrust has always been on manufacturing for exports. However, the domestic demand too has grown in the past couple of years, indicative of where Indian companies in the perfume business are headed.

While European fragrance brands are facing recessionary trends, the domestic market is booming. PGP’s domestic perfume bottle sales saw a strong double-digit growth in the last financial year and are on track to continue that momentum this financial year as well,” he says.According to Gupta, what disrupted the market was the entry of new players, fresh fragrances suited to Indian taste, and smaller packs by new brands launched by entrepreneurs in the past couple of years.

“Some of these new brands have grown exponentially. Larger companies are aspiring to be them,” he says.

MARKED SHIFT AFTER THE PANDEMIC

Most prominent names in Gujarat are second- or third-generation businesses, says Shalin Sanghvi. “Demand has blown after Covid. The market is now more open with the e-commerce boom. In all this, Gujarat has remained a key manufacturing hub. Orders from existing clients have increased and new ones are being added.

Competition is now 10-fold compared to a few years ago.Around four new companies have come up in Ahmedabad this year alone,” he says“India, and Gujarat, are large markets as well as manufacturing hubs, with finished products going to the UAE, Africa and US markets. Sales are booming, be it retail, online, institutional or export-oriented,” says an industry player who set up his facility Chharodi in 2021, requesting anonymity.

“Till then, the market saw two or three new fragrances brands enter the market each year. The number is now much higher.

You find perfumes and deodorants being sold from every store, even paan shops. In rural Gujarat, 10-15ml bottles priced under Rs 100 have a big market.”

FARMING FOR FRAGRANCE

Farmers in Kutch and Saurashtra, aided by the Central Institute of Medicinal and Aromatic Plants (CIMAP) under the Centre’s Aroma Mission, are cultivating essential oil crops like palmarosa, vetiver and lemongrass— ingredients the fragrances industry banks on.

Urmil Gala, 47, has been cultivating palmarosa over 100 acres in Gundala near Mandvi since 2016. This is his tenth year reaping its fragrant bounties.

Business has boomed, especially in the past three years — his harvests are booked in advance, and Gala now has two distilleries – one his own and the other provided by CIMAP. The yield: 40kg oil per acre annually. The returns: Rs 3,500-Rs 4,000 a kilo.“I sell directly to traders and fragrance companies. UAE brand Ajmal is one of them.”

Palmarosa oil from Kutch is said to be the best, the district’s harsh climate actually boosting the quality. This hardy crop needs less water. “The less you water the crop, the more fragrant the oil will be,” he says. Kutch has four farmers cultivating this grass, with the total area under cultivation in the district at approximately 2,000 acres, says Gala.

PACKING IT RIGHT

Faliith Pandyaa, director, Print Vision Pvt Ltd, notes that Gujarat’s perfume packaging industry has grown rapidly over the past five years, driven by emerging brands keen to stand out.

“Premium and ultra-luxurious packaging is the need of the hour, and we’re focused on meeting this demand,” Pandyaa says. Zetts has its own design studio at its Mumbai HQ, taking care of everything from bottle to box design. Dipen Gandhi, business development and marketing head at Print Vision puts the ratio of legacy brands to new entrants at 40:60.

“Some old names have revived themselves seeing the awakening of people towards perfumes,” he adds.

BOX THE BUSINESS OF OLFACTORY EXPERIENCES

Trove Experience, which holds experiential workshops across India, recently held its first perfume mixing workshop in Ahmedabad, a city with a large young population curious about fragrances. Participants aged 25-45 years put together a scent, guided by perfume sommelier Samyak Varia from Flavaroma, a Gujarat company. “Scents are personal and nostalgic. In India, they also play a role in cultural and spiritual practices,” says Noopur Lidbide from Trove Experience.