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Unilever Plc’s departing India chief cautioned that his successor will have to navigate increasingly heated competition, as global giants to powerful domestic tycoons — including Mukesh Ambani and Gautam Adani — race to get a foothold in the country’s fast-growing consumer market.
Mehta hands over the reins to fellow Unilever veteran Rohit Jawa later this month, at a time of intense investment interest in India. Local billionaires Ambani and Adani, as well as conglomerates like Tata Group, are expanding their reach into household staples to tap into its huge population, which may have already surpassed China as the world’s most-populous nation.
“Competition, we have to be absolutely clear, is going to keep increasing,” Mehta, 62, said in an interview at the company’s headquarters in Mumbai. “There will be very few multinationals in whose strategy India would not feature right on top. Every big company would like to double down on it,” he said without elaborating on specific companies.
Mehta reiterated a prediction that India will inevitably become Unilever’s largest market by revenue, potentially sooner than next decade. The company reported Indian turnover — a measure that comprises sales of goods after a deduction of discounts, sales taxes and estimated returns — of 6.87 billion euros ($7.4 billion) in 2022, trailing only the US’s 12.1 billion euros.
Despite the broader, positive outlook for India, the company faces short-term challenges. Persistently high inflation has seen a lopsided post-pandemic recovery between its more affluent urban markets and rural areas, where about 70% of the population lives. Sector-wide rural market volume growth in the quarter through March was down 3% compared to last year, and Mehta warned that demand outside of cities will remain below pre-Covid levels for the coming year.
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His tenure as Unilever’s India chief was buffeted by multiple black swan events, including Prime Minister Narendra Modi’s abrupt banknote demonetization in 2016, Covid chaos and the ensuing economic ructions. Meanwhile, in 2020 the firm renamed Fair & Lovely, a melanin-suppressing face cream that’s one of the firm’s best-sellers in India, after criticism it was promoting deeply entrenched concepts of Indian beauty that sees paler skin as desirable.
“India is not a homogeneous country — we were not recognizing the heterogeneity and consequently the potential,” Mehta said.
That strategy has been replicated across most large goods companies in India, Jefferies analysts wrote in March when Mehta’s retirement was announced. “While big shoes to fill, Sanjiv expects momentum to continue under Rohit Jawa, a long-timer with the group,” they said.
As for Mehta, he’s in talks for a number of new opportunities that he expects to firm up in coming months. He’s already a director at Air India Ltd., and will join French dairy giant Danone’s board in July. “I’m not hanging my boots, I’m changing my socks,” he said.
And, despite rising competition in the consumer sector, Mehta’s expectations for Unilever and Jawa are upbeat. “India’s consumption story is just unfolding,” he said. “The aspirations of consumers are moving up everywhere.”
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