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English Views: 0 Author: Site Editor Publish Time: 2025-09-04 Origin: Site
Unicharm's Strategic Expansion in India
Strengthening its foothold in a key growth market
Unicharm has recently reached a significant milestone in its Indian expansion with the official launch of its third factory in Gujarat during the first quarter of this year. This new production base, representing a total investment of $131 million, is dedicated to manufacturing the company's core brands, including MamyPoko baby diapers and adult incontinence care products. This move is expected to increase Unicharm's total diaper production capacity in India by 30%, signaling a new phase in its strategy to double down on the Indian market.
Unicharm's journey in India began around 15 years ago with the introduction of its MamyPoko brand. The company quickly became the second-largest diaper brand in India, second only to Procter & Gamble's Pampers. Fueled by India's high birth rate (approximately 23 million births annually) and a growing consumer base, Unicharm has maintained an annual sales growth rate of around 30% in the region. This growth made it challenging for the existing production capacity to keep up with demand, which was a key reason for building the new factory.
This recent expansion is part of a broader global strategy shift for Unicharm, which has been redirecting its resources from China to India and Africa. This adjustment comes as Unicharm faces intense competition from local brands in the Chinese market, where its diaper market share dropped from 11% in 2012 to 7% in 2019. At the same time, with India's per capita GDP exceeding $2,200, the demand for diapers has entered a period of rapid growth, presenting a huge market opportunity. Unicharm and P&G currently hold about 40% of the Indian diaper market, and the new factory will further strengthen Unicharm's local supply chain, reduce import dependency, and allow for more flexible responses to regional demand.
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The new factory's value extends beyond just increased capacity; it also signifies a deep adaptation to India's social structure and consumer characteristics. With a large infant population and a growing aging population, Unicharm is producing both baby and adult diapers at the new facility to cover full life-cycle care needs.
Unicharm is also introducing successful innovation models from Southeast Asia, such as "single-piece individually packaged" and "five-piece economy packs" of diapers for lower-income consumers. These innovations lower the barrier to entry, ensure hygiene, and facilitate distribution through dispersed retail channels like small mom-and-pop stores. This strategy helped Unicharm capture a 50% market share in Indonesia and is expected to be successful in India as well.
However, Unicharm faces several challenges in India. These include the dynamic local startup ecosystem and potential disruption from digital innovation. Additionally, bottlenecks in India's manufacturing infrastructure could affect production efficiency. The company is also implementing higher safety standards, such as fire prevention measures, following a factory fire in Rajasthan in 2017.
In its Q1 2025 financial report, Unicharm reported net sales of approximately ¥227.52 billion, a 3.7% decrease year-over-year. Core business income was down 22.7% to ¥29.02 billion, while net profit attributable to the parent company increased by 39.7% to ¥24.91 billion.
Unicharm's Personal Care business segment had net sales of ¥186.85 billion. The company has been actively investing in overseas marketing, particularly in China, where it sees a vast market for adult care products due to the accelerating aging population. In other Asian countries like Thailand, Vietnam, and Indonesia, Unicharm is expanding its product lineup and promoting Japanese care models to meet the growing demand for adult care products. In Japan, the company increased sales by expanding its product and service offerings for adult care products suitable for daily activities.
In China, Unicharm has launched new female care products, including panty-type sanitary napkins that are popular with consumers. Responding to the increased budget consciousness among younger consumers, the company has also introduced more cost-effective options. In Thailand, Indonesia, and Vietnam, high-value-added products like cooling sanitary napkins have performed well, leading to stable net sales growth.
In India, with a low penetration rate for hygiene products, Unicharm has maintained stable net sales and improved profitability by offering a full range of products, including antibacterial female care products and individually packaged single-use items tailored to local economic conditions.
For its Baby Care business, Unicharm is facing intense competition in China due to the development of local companies and a declining birth rate. The company is focusing on its high-end Moony brand to meet market demands and improve profitability through stable supply and cost optimization. In Japan, despite a shrinking market, Unicharm has launched new high-value-added products like the MamyPoko and Moony series, which have been well-received by consumers. In Southeast Asia, the company is facing market stagnation due to declining birth rates and e-commerce price wars and plans to adopt a dual-brand strategy. In Vietnam, Unicharm has maintained its market leadership by actively promoting the concept of disposable diapers.
