Minimalist Valued at ₹3,000 Crore: HUL Nears Strategic Acquisition
Hindustan Unilever (HUL) is reportedly in advanced discussions to acquire the direct-to-consumer (D2C) skincare brand Minimalist for an estimated valuation of ₹3,000 crore, according to informed sources.
A Brief Background on Minimalist
Launched in 2020, Minimalist has gained recognition for its ingredient-focused skincare products.
The company’s initial funding came through its Series A round, led by Unilever Ventures and Sequoia Capital India (now Peak XV Partners).
The brand’s consistent growth and profitability have made it a standout player in the D2C skincare space.
An HUL spokesperson, when asked about the potential acquisition, stated, “In line with our business strategy, on an ongoing basis, we evaluate various strategic opportunities for growth and expansion of our business. We will make appropriate disclosures whenever there is any material development that requires disclosure under applicable laws.”
According to a source, the deal is expected to conclude in Q4FY25, with HUL aiming for majority control of the company. Founders Mohit Yadav and Rahul Yadav might retain a minority stake in the brand.
Financial Performance and Valuation
The acquisition’s valuation is projected at 8-10 times Minimalist’s FY24 revenue of ₹347.4 crore, up significantly from ₹183.8 crore in FY23.
Profit after tax (PAT) also more than doubled, rising from ₹5.2 crore in FY23 to ₹10.8 crore in FY24. Sources suggest the final valuation could exceed the initial estimate, further underscoring Minimalist’s growth trajectory.
If finalized, this acquisition will mark a significant milestone in the D2C sector, with Minimalist’s valuation increasing nearly fivefold within three years, from ₹630 crore to ₹3,000 crore. This would make it one of the largest deals in the space.
HUL’s Strategic Expansion
In December 2022, HUL announced its entry into the health and wellbeing sector by acquiring stakes in two companies: Zywie Ventures (OZiva) and Nutritionalab (Wellbeing Nutrition).
Commenting on HUL’s Q2FY25 performance, Managing Director and CEO Rohit Jawa highlighted the company’s focus on the light moisturizer category.
“Today, consumers are looking for more than just basic moisturization. They want superior benefits through pleasant, non-sticky experiences,” he said.
Jawa also emphasized HUL’s commitment to e-commerce and beauty channels, which have driven consistent market share growth. Beauty and wellbeing now contribute 21% of HUL’s revenue.
This acquisition aligns with HUL’s strategy of transforming its portfolio to meet evolving consumer aspirations.
Market Dynamics
FMCG giants have been increasingly eyeing new-age brands to tap into younger demographics. Similar to HUL’s interest in Minimalist, companies like Marico, ITC, and Dabur have acquired emerging brands such as Beardo, Plix, and Yogabar.
HUL’s acquisition of Minimalist could integrate the brand into its extensive portfolio, which includes Dove, Pond’s, Lakme, and TRESemmé.
Minimalist’s founders currently own 83.7% of the company, while Peak XV holds a 6% stake, as per Tracxn data. The brand’s products are primarily sold online through platforms like Nykaa and its website, as well as offline retail channels.
Minimalist’s Competitive Edge
Unlike many of its competitors, Minimalist has been profitable since FY21. Its net profit doubled in FY24, reaching ₹10.8 crore. The company’s strategy prioritizes innovation over pricing as a growth driver.
According to co-founder Mohit Yadav, “We focus on innovation and finding gaps that can be tapped, rather than relying on pricing growth levers.”
This disciplined approach has helped Minimalist achieve profitability, unlike other D2C beauty brands such as Sugar Cosmetics, mCaffeine, and Wow Skin Sciences, which remain in the red due to high expenditure on offline expansion.
HUL’s potential acquisition of Minimalist represents a strategic move to strengthen its presence in the D2C skincare market.
By integrating Minimalist into its portfolio, HUL aims to capture the attention of younger consumers and expand its footprint in the fast-growing beauty and personal care sector.
