Colgate-Palmolive (India) (500830) Investor Day 25/26 summary

Strategic Priorities and Market Context

• Focus on growing the oral care category through increased consumption, premiumization, and leadership in toothbrushes, while building personal care as a secondary pillar.

• Premiumization in toothpaste has risen from 14.8% to 18.6% over three years, but remains below other FMCG categories, indicating significant headroom.

• Oral care penetration is nearly universal, but per capita toothpaste and toothbrush consumption in India remains below other markets, especially in rural areas, presenting significant growth potential.

• E-commerce and quick commerce channels are highly accretive for growth, margin, and premiumization, with internal e-commerce contribution now in double digits and new retail contributing ~40% of category sales.

• Brand leadership is reinforced by high recall (67% top-of-mind) and wide distribution (7.1 million stores).

Business Development and Innovation

• Premium brands (Total, Visible White, PerioGard) are prioritized, with innovation and digital-led marketing driving 5x faster growth than key competitors.

• New launches include Harry Potter-themed toothpaste and toothbrushes, a toothpaste pump format, and Bluey-themed kids’ products.

• Colgate PerioGard is the first brand certified by the Indian Society of Periodontology, supporting a push into therapeutics.

• Partnership with Bombay Shaving Company aims to accelerate Palmolive’s digital and D2C growth, with BSC managing e-commerce and D2C while Colgate retains product and supply chain control.

• Premiumization is being democratized, with uptake seen in Tier 2 towns and rural areas, enabled by digital communication and evolving retail channels.

Financial Performance and Investment Approach

• Sales for Q1 reached INR 1,591 crore, up 12%, with profitability at INR 343 crore, up 10.6%; profit after tax at 22.3%.

• Gross margins have improved to 69-70% (from 65-68% in FY21-23), driven by manufacturing efficiencies, localization, automation, and favorable product mix.

• Premium toothpaste sales contribution has increased 2.5x, with advertising spend up 34% YoY in Q1, focused on premium brands and new channels.

• Return on capital employed remains at 121%, with consistent dividend payouts and INR 10,000 crore returned to shareholders over 10 years.

• Working capital optimization has improved, with net working capital as a % of sales at -15.3% in FY26.