India’s fast-moving consumer goods (FMCG) sector has entered FY27 on a stronger footing despite macro-economic uncertainty, El Nino concerns and inflationary pressures. For Marico, the maker of Parachute, Saffola and Livon, the June quarter reflected this recovery. In an interview with Viveat Susan Pinto, Saugata Gupta, MD & CEO, Marico highlights the sustainability of demand, the company’s premiumisation strategy and acquisition plans as well as the rapid rise of quick commerce. Excerpts:

Q: Marico’s India business delivered an impressive 11% volume growth in Q1. What contributed to this growth?

Since the GST rationalisation implemented in September last year, we have seen a meaningful improvement in FMCG demand, particularly in the urban markets. The second half of FY26 witnessed stronger volume growth across the industry, and we delivered high single-digit growth, among the highest in the industry. We have continued that momentum into FY27.

While the year has seen disruptions and inflationary pressures, the Indian consumer has remained relatively insulated compared to several other emerging markets. During periods of supply chain uncertainty, larger players also tend to be better positioned than smaller competitors. Our strategic price reductions in Parachute loyalty packs and distribution expansion has helped drive this unprecedented volume growth in Q1.

Q: Do you see demand holding up despite the macroeconomic uncertainties this year?

We were slightly cautious about rural demand because of the deficient rainfall in June, but July rains showed significant improvement. If the broader macroeconomic environment remains stable, we believe the demand should continue to hold up. While the El Niño remains an important factor to monitor, larger players are better equipped to navigate periods of volatility and uncertainty.

Key input prices, notably, copra, remain 30–35% below last year’s peak levels. We have already implemented selective price increases within the value-added hair oils (VAHO) portfolio and our plans already factor in elevated crude prices. Even if crude remains in the $85–90 range per barrel, we remain comfortable.

 Q: Marico has indicated it will continue looking at acquisitions in FY27. Which areas will interest you now?

Earlier this calendar year, we completed three acquisitions across gourmet snacking (4700BC), skincare (Skinetiq in Vietnam) and plant-based nutrition (Cosmix). While there may be a few strategic gaps that we may choose to address over time, we remain highly disciplined in our approach towards digital brands.

We believe we have the foundations of two strong digital platforms. One in beauty and personal care and another in foods. Both platforms offer significant growth opportunities, not only in India but also across markets such as Vietnam and parts of the Middle East.

Q: Quick commerce continues to grow rapidly while modern trade and broader e-commerce have slowed. What explains for this?

Quick commerce has seen significant investment in recent years, with several new entrants and a unique value proposition for shoppers, all of which continue to drive growth. We believe quick commerce is here to stay. However, we see quick commerce and other alternate channels as drivers of premiumisation and innovation. The key is to have the right portfolio and channel architecture in place so that channel growth is incremental and accretive rather than cannibalistic.

Q: Marico has also spoken about driving structural shifts towards premium and higher-margin categories. How will this play out?

There are multiple vectors of growth across the portfolio. With our core business, we are accelerating premiumisation through focussed investments behind our premium offerings. We are doubling down on Saffola Cold Pressed Oils, which is a growing consumer trend.

We are also expanding premium personal care with our Parachute Advansed Protein Shampoo launch, while continuing to scale our Foods and Digital businesses. Internationally, we are reducing our dependence on Bangladesh while increasing the contribution of premium personal care categories across markets.

Q: Does this mean margins will be prioritised over volumes in some areas?

We have multiple vectors of growth to support our ambitions and remain extremely confident of delivering high single-digit volume growth in FY27. We delivered around 9% volume growth last year (FY26) and 11% this quarter (Q1FY27).

Q: What will drive the high-teen EBITDA growth that Marico is targeting this year?

High-teen EBITDA growth will be driven by a combination of a more favourable portfolio mix, the commodity cost environment, and a significant improvement in the profitability of our foods and digital businesses.

Q: How is Project Setu, your go-to-market initiative, progressing?

Project Setu continues to deliver strong results and has been a key contributor to our significant growth over the past few quarters. We have also successfully replicated this model in Vietnam, contributing to the business turnaround in the market.

The next phase of Project Setu will focus on expanding reach into new outlets, including pharmacies, chemists and beauty stores in urban markets. We also plan to leverage Marico’s go-to-market network to accelerate distribution for our digital-first brands over the next 12 to 18 months.