Colgate-Palmolive India to Increase Advertising Spend to Support Premium Toothpaste Growth

Colgate-Palmolive India plans to increase its advertising expenditure from already elevated levels as the company seeks to accelerate the growth of its premium toothpaste business. According to company management, the premium segment is currently expanding at approximately six times the rate of the overall market.

During the first quarter of fiscal year 2027, the company spent ₹252 crore on brand investments, marking a 34 per cent increase compared to the same period the previous year. This pushed advertising and promotion expenses to 15.8 per cent of total sales. Alongside these investments, Q1 FY27 sales rose 12 per cent to ₹1,591 crore, while adjusted net profit increased 10.6 per cent to ₹343 crore.

Speaking at the company's Analyst Meet 2026, Prabha Narasimhan, Managing Director and CEO of Colgate-Palmolive India, noted that expectations of 20 per cent growth for the premium segment underestimate the market potential. Premium toothpaste currently accounts for 18.6 per cent of India’s overall toothpaste category, up from 14.8 per cent in 2023. Narasimhan stated that the category's share could potentially move toward the 40 to 60 per cent levels observed in other personal care categories like soaps and shampoos, though no specific timeline or official target has been set.

Jacob Madukkakuzhy, Whole-time Director and CFO, stated that the company's financial bias leans toward higher advertising, which may impact near-term EBITDA percentages. Madukkakuzhy confirmed that the company is not currently working toward a specific EBITDA level if increased spending drives corresponding revenue growth.

The company's financial flexibility is supported by a gross margin of 69.7 per cent in Q1 FY27, complemented by its "Funding the Growth" cost-saving programme, which generated savings equivalent to 4.7 per cent of sales in 2026 to fund brand investments.

Colgate's primary premium product lines include Colgate Total, Visible White, and PerioGard. PerioGard net sales are reportedly doubling annually, while the Sensitive product line is growing approximately ten times faster than the broader sensitivity category. Whitening remains another key area of focus; penetration in India stands at roughly 2 per cent compared to 20 to 25 per cent in the United States, with Visible White leading the company's efforts in the segment.

To support distribution, the company aims to increase premium-product availability across its roughly 1.7 million directly reached retail outlets, while expanding direct distribution in urban areas and emerging city corridors. Digital channels will continue to play a role, with e-commerce described as growth- and margin-accretive.

At the mass-market end, the company has implemented low-single-digit price increases in response to inflation, but does not intend to execute frequent hikes. Furthermore, Colgate has maintained additional grammage on its ₹10 and ₹20 price points to support budget-conscious consumers.

"Colgate's strategy demonstrates a clear focus on long-term value creation by prioritizing market share in high-margin premium segments over short-term EBITDA optimization. By redirecting efficiency savings and maintaining strong gross margins toward aggressive brand building and distribution expansion, established companies can successfully capture shifting consumer preferences. For growing businesses and consumer startups, this approach underscores the importance of recognizing category tailwinds and aggressively reinvesting capital into high-growth product lines when market penetration is still nascent." — Dr. Shishir Gupta, Founder & CEO, StartupLanes