PRIVI SPECIALITY CHEMICALS LIMITED Annual Report 2020-21

43 Annual Report 2020-21 CORPORATE OVERVIEW STATUTORY REPORTS FINANCIAL STATEMENTS Personal Care Personal care is expected to witness the fastest CAGR of 3.9% from 2019 to 2025. Increasing the working-class population in developing economies including China and India is expected to increase the scope of personal care products including perfumes and deodorants. Furthermore, shifting preferences towards natural personal care products with better quality has augmented sales. Manufacturers are launching new products to gain a larger market share. (Source: Grand view research) New Distribution Channels The offline segment was the largest distribution channel in 2018, holding 92.1% of market share. This distribution channel includes supermarkets and hypermarkets, brand outlets, drug stores, direct selling and unorganized retail. In developing countries, such as India, Thailand, Bangladesh, and Taiwan, unorganized retail is one of the key distribution channels. The online channels’ segment is expected to witness a CAGR of nearly 4% from 2019 to 2025. The increasing penetration of high-speed internet and smartphone users is expected to fuel the expansion of the segment. Besides, the hassle-free purchase, availability of a wide range of products and convenient delivery are also driving growth. The North American market is projected to grow at a CAGR of 5 to 6% from 2020 to 2027 on account of high consumer emphasis on the premium & luxury personal care products, especially in the U.S. and Canada. Asia-Pacific is the fastest-growing region witnessing a CAGR of 4.9% from 2019 to 2025. Many players are launching new products in developing countries such as India and China to cater to the increasing base of consumers. The Asia-Pacific region possesses one of the largest consumer bases and occupies a significant market share. This region is also expected to register the highest growth owing to rise in the demand for the personal care & cosmetics products, especially in the countries such as China, India, Indonesia, among others. Europe is the leading consumer in the cosmetics market and is expected to retain a significant market share by 2027. France, Spain, Switzerland Italy, among others are increasingly adding newer customers year-on-year due to higher penetration for cosmetics & toiletries products. (Source: Grand view research) Industry Growth Strategies Manufacturers are adopting several strategic measures including mergers and acquisitions, capacity expansion, technological innovation, and product innovation. Major producers are increasing their geographical reach especially in developing countries to gain maximum product penetration. The establishment of strategic partnerships with major importers and buyers of the region to launch new products as per the customer’s demand is expected to be a critical success factor over the next few years. Taking into account all these factors, producers are likely to focus on product innovation catering particularly to developing countries and untapped application areas. (Source: Grand view research) Cosmetics, Perfumes, Fragrance Product Insights Manufacturers are also focusing on widening their offerings to include high-end products. For instance, Coty has slimmed down its product portfolio of low-priced labels after the acquisition of some Procter & Gamble Co.’s beauty brands. Since then, it has been focusing on luxury lines which include Gucci Bloom and Tiffany & Co. that are targeted at millennials. Decline in the mass perfume products is majorly attributed to increasing preference for premium fragrances among consumers. This has been driving manufacturers to shift their focus towards premium products, thereby contributing to the growth of the global market. (Source: Grand view research) End User Insights Women accounted for the largest share of consumers with 60.1% in 2018. According to research studies, women in U.S. purchase a new perfume as often as once a month, in comparison to men who buy it on an average of 1-2 times per year mainly for the purpose of replenishment. As per a survey, around 41% of women in U.S. use perfumes everyday as compared to men.