Colgate-Palmolive India’s Q1 results showed pressure on sales and profits, but CFO M.S. Jacob is betting on premiumisation, rural expansion and cost discipline. With habits still under-penetrated, Jacob says sustainable growth lies in getting India to brush more, and brush better.
M.S. Jacob, CFO of Colgate-Palmolive India
At first glance, oral care in India looks tapped out. Toothpaste penetration is near universal, Colgate’s market share is entrenched, and oral hygiene is a routine that cuts across urban and rural lines. For many consumer goods firms, such saturation would be the peak. For Colgate-Palmolive (India) Limited, it’s just the next frontier.
“In a country where 55% of rural Indians don’t brush daily and 80% of urban Indians don’t brush twice a day, addressing this presents a significant opportunity for us as category leaders,” says M.S. Jacob, CFO of Colgate-Palmolive India. “Premiumisation is another key lever where we can upgrade our consumers within our current portfolio while maximising revenue growth.”
The company’s growth story, then, is not about adding new households to the brushing fold. It is about changing entrenched habits, nudging consumers towards more frequent brushing and trading them up to higher-value products. That is a harder battle to fight — and a slower one to win — but one Jacob believes is critical for future-proofing Colgate’s Indian business.
The June quarter results laid bare the challenge of running a business where consumer demand is uneven and competition has intensified. Net sales slipped to Rs 1,421 crore from Rs 1,486 crore a year earlier. Net profit after tax dropped to Rs 321 crore from Rs 364 crore.
CEO Prabha Narasimhan admitted that “persistent headwinds from subdued urban demand and elevated competition intensity” weighed on performance. She also pointed out that the year-ago quarter was a high base, following strong 12% CAGR sales growth between Q1 FY23 and Q1 FY25.
Yet Narasimhan struck a note of optimism: premium portfolio revenue is growing strongly, brand investments have continued, and she expects a “gradual recovery in the back half of the year.”
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What makes this cycle more complex is the divergence between India’s rural and urban markets. Urban households are showing caution, pressured by discretionary inflation and competition from newer players. Rural India, while under stress, continues to deliver small but critical pockets of resilience.
Jacob explains how this split has forced Colgate to rethink how and where it spends. “We continue to invest behind robust distribution as a growth driver by being competitive on trade spends on key packs,” he says. “We dynamically allocate our marketing investments to capture the growth where it is strongest; for example, we have invested behind rural media in terms of wall paintings in the past couple of quarters.”
In other words, Colgate isn’t doubling down on television or digital alone. It is reaching consumers through painted walls in villages, a reminder that in FMCG, distribution muscle and hyperlocal visibility often move the needle more than flashy campaigns.
For a company that has long been synonymous with mass-market oral care, Colgate has successfully built a premium play. Whitening solutions, herbal and Ayurvedic variants, and specialized sensitivity products have broadened the portfolio. Yet the tension remains: Indian consumers are aspirational but extremely price-sensitive.
“Balancing premiumisation with price sensitivity is a strategic imperative in India,” Jacob says. “Our premium products are backed by science and have strong functional delivery which hence become value for money. We also tier our pack sizes and pricing to draw consumers at different price points. And we continue to invest behind communicating the functional benefits to ensure a steady rate of triers and repeats.”
That tiering strategy is visible in recent launches. The Colgate Kids Squeezy Toothpaste, in strawberry and watermelon flavors, makes brushing fun for children while addressing parents’ price concerns. The MaxFresh Mouthwash sachet-stick format brings premium oral care into an affordable single-use format, ensuring a Rs 10 purchase can still feel like an upgrade.
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For consumer businesses, inflation has been a relentless theme. The cost of raw materials can wipe out margins if not managed carefully. Colgate’s approach, Jacob said, is deliberately balanced.
“We have a very strongly governed ‘Funding the Growth’ program where cross-functional teams come together to drive cost efficiencies,” he says. “This typically allows us to mitigate inflationary impacts. If inflation is significant, we also consider targeted and judicious price revisions based on market conditions.”
This isn’t a blanket strategy of cost-cutting or price hikes. Instead, it’s a carefully tuned balance, designed to preserve profitability without alienating consumers who are already watching their spending.
Few FMCG businesses in India are as consistently profitable as Colgate. Behind that record is a set of finance-led guardrails Jacob describes as “deeply embedded.”
“At Colgate, delivering sustainable profitable growth is central to our financial strategy,” he says. “We have Revenue Growth Management under which we have clear frameworks around pricing, portfolio mix and promotional effectiveness. We also employ rigorous cost optimisation programs which are deeply embedded in our operations. And we prioritise disciplined capital allocation through a strong return on investment lens.”
In practice, this means the company can defend its margins even when sales soften, a rare quality in a sector where profitability is often sacrificed to chase market share.
Colgate India has long been known for being capex-light. But the company isn’t starved of investment. The emphasis, Jacob says, is on striking a balance between back-end systems and consumer-facing innovation.
“We continue to invest in backend systems which enhance our operational efficiencies and improve data analytics. “At the same time, consumer-facing innovation is critical. The key is to ensure that backend investments provide agility and efficiency to quickly bring these innovations to market and help them scale effectively,” he says.
That balancing act, lean infrastructure, strong analytics, and high R&D spend on consumer innovation, is what allows Colgate to stay nimble in a competitive landscape.
While quarterly P&Ls and balance sheets dominate headlines, Jacob prefers to track two additional metrics.
“ROCE gives a clear picture of how effectively we are using the capital employed to generate profits. “We also closely track operational cash generation. These indicators keep us honest about the health of the business in ways topline and bottom line alone cannot”, he says.
For a company like Colgate, which has historically returned cash to shareholders while sustaining growth, these metrics are not academic, they are essential.
The biggest challenge for a CFO in FMCG is balancing quarterly expectations with strategic bets that only pay off years later. Jacob frames his approach as a “dual lens.”
“All decisions are evaluated for their short and long-term impact both,” he says. “This prevents sacrificing future growth for immediate gains. While immediate challenges often demand attention, we ensure a significant portion of our resources is consistently directed towards strategic initiatives that will drive future growth.”
That explains why, even in a quarter where profits dipped, Colgate doubled down on launches, brand investments, and its ESG agenda.
Beyond the numbers, Colgate has been pushing its sustainability and oral health agenda. This quarter saw the release of its fourth ESG report, outlining efforts in water and energy conservation, plastic reduction, and community programs.
The company also hosted the Oral Health Movement Summit in June 2025, with Union Health Minister JP Nadda in attendance. The summit unveiled “India’s Oral Health Report,” collating nationwide screening data and offering actionable insights on oral hygiene.
These initiatives may not move quarterly earnings, but they strengthen the brand’s long-term credibility and consumer trust, something no P&L line can capture.
Colgate’s story in India is not one of easy wins. It is a story of discipline under pressure, of growth in a category that looks mature on paper, and of resilience in profitability even when sales dip.
As Jacob put it: “Sustainable profitable growth is not about chasing one lever. It’s about keeping every lever in motion without losing sight of the long-term.”
For a company that has been in Indian bathrooms for generations, the next wave of growth will not come from adding new users, but from persuading the same households to brush more often, brush better, and increasingly, to brush premium.
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