AROMATIC ASCENT

Fragrance chemistry blends raw material might with India's global sway and consumer surge

- 

The Indian fragrances and aroma chemicals sector is quietly becoming one of the most compelling long-term investment themes in the country.

What sets it apart is the rare combination of commanding global raw material dominance, a booming domestic consumption market, and its alignment with powerful megatrends such as the shift to natural ingredients, sustainability, and premiumization.

From toothpaste and packaged food to perfumes, beverages, and medicines, fragrance and flavour inputs are woven into daily life. India’s unique position in mint, spice oleoresins, and other extracts, coupled with its cost advantages and rising consumption base, makes this sector a niche opportunity.

INDIA’S RAW MATERIAL SUPREMACY: MINT AND OLEORESINS

India today occupies a commanding position in the global raw material supply chain for fragrances and flavour chemicals, particularly in mint extracts and spice oleoresins. As of FY24, the country accounted for 81% of global mint oil production, which translates to about 39,000 metric tonnes valued at roughly $635 million. The cultivation of mentha arvensis, or corn mint, has made India the world's largest producer and exporter of mint oil and its derivatives such as menthol and dementholized mint oil (DMO).

Roughly a quarter to a third of total production is exported, and India’s share in global DMO output is equally dominant at 81%. In 2023 alone, India exported over 15,000 tonnes of menthol products worth more than $233 million, highlighting the critical role it plays as a supplier to the world.

A similar story is playing out in spice oleoresins. Spice oleoresins are concentrated extracts of spices, capturing both the volatile oils (which give aroma) and the nonvolatile resinous fractions (which give flavour, pungency, and colour). Because they deliver standardized flavour and longer shelf life compared to raw spices, they are widely used across industries.