In the first clear indication that Indian luxury brands have come of age, Estee Lauder has bought into Forest Essentials, an Indian luxury ayurvedic skin, body and hair care brand.
Though Estee Lauder has taken a minority stake for an undisclosed sum in the Indian company founded by Mira Kulkarni, Forest Essentials will now be a part of its portfolio, which includes popular brands like Aramis, Clinique, Origins, MAC, Tommy Hilfiger, Donna Karan and, of course, Estee Lauder.
"This agreement will help us expand our growing expertise and competitiveness in the natural products arena, while Forest Essentials will benefit from our long history of successful brand management and global expansion," William P Lauder, chief executive officer of The Estee Lauder Companies, said.
The stake gives Estee Lauder a strong presence in the top end of the rapidly expanding beauty business in India. Forest Essentials, in turn, will be able to spread its wings into markets other than India with help from Estee Lauder.
"This strategic relationship will give us access to Estee Lauder's research labs, especially for packaging, which will allow us to strengthen our brand," Samrath Bedi, executive director of Forest Essentials, told Business Standard.
"The Estee Lauder Companies' expertise in brand building, marketing and distribution will help take Forest Essentials to its true potential. They liked our product range and the manual intensive method of production and plan to retain it," added Kulkarni, who is also the CEO of Forest Essentials.
Following its association with Estee Lauder, Forest Essentials plans to add a new manufacturing facility at Hardwar in Uttarakhand this year with an investment of Rs 5 crore to Rs 6 crore. It already has a facility there along with a research and development centre.
Estee Lauder launched its products in India in July 2005. The Indian luxury goods market is estimated to be worth Rs 2,200 crore, growing at 25 per cent a year.
Forest Essentials has seven stores in the country and also supplies its products to high-end hotels and spas.
