India’s D2C companies, flush with acquisitions and riding the beauty and skincare boom, are now facing an unexpected geopolitical risk: supply-chain exposure to West Asia.
An analyst anonymously told Storyboard18 that beauty and personal care brands acquired by large e-commerce and FMCG companies, including Nykaa’s Dot & Key and Earth Rhythm and Marico’s Plix, are particularly vulnerable to disruption stemming from conflict in the region and rerouting along the Red Sea corridor.
Nitish Rai, founder and Chief Executive Officer of logistics intelligence firm FreightFox, said the exposure varies by product but is material across portfolios. Earth Rhythm’s hand cream, for instance, depends on 8-10 ingredients shipped along the Europe-India lane, of which several are linked to petrochemical feedstocks. Rerouting shipments around the Cape of Good Hope has increased lead times from 8-14 weeks to as much as 111-18 weeks, while also lifting landed costs by 3-6%.
For sunscreen, among the most formulation-sensitive categories, the exposure is higher. Dot & Key depends on 10-12 imported ingredients, including four UV filters that anchor the bill of materials. Rai estimated cost inflation of 6-10%, compounded by reliance on specialized inputs such as titanium dioxide sourced from Japan that must bypass the Suez Canal, adding both time and expense.
By comparison, Plix’s anti-hairfall shampoo faces moderate disruption. While it draws on European inputs and argan oil sourced through Morocco, some material, notably silicones shipped from the US through Atlantic routes, avoid Suez chokepoint. Even so, costs are expected to rise by 3-6%.
Executive highlighted that a growing dependence on geographically concentrated “hero ingredients”. Kakadu plum in Dot & Key products, argan oil in Plix, and kokum and shea butter used by Earth Rhythm are all subject to tightly constrained annual harvest cycles. As brands scale, these input risk becoming binding constraints unless upstream sourcing is secured early.
Hindustan Unilever’s Minimalist also rely on raw material and intermediates sourced from, or routed through, the Gulf.
Minimalist, with 12-18% of formulations, including UV filters, such as Ethylhexyl Triazone, BEMT, among others, being partly sourced through West Asia, increasing vulnerability to rerouting via the Red Sea, which raises freight and insurance costs.
Last week, HUL announced that it would be increasing the prices by 2-5% across its product portfolio as input cost is expected to rise by 8-10%.
An industry veteran said that substitution challenges could prolong the impact. “Specialty chemicals derived from crude are deeply embedded in formulations and cannot be substituted overnight,” said Madhusudhan Rao, former executive director for beauty and personal care at HUL.
He added that while companies’ short-term disruptions in cost and supply chains are inevitable, the situation presents a long-term opportunity.
The June quarter of FY27 will be critical in determining how far supply-side pressures are being absorbed versus passed on to consumers.
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First Published on May 4, 2026, 09:11:02 IST