Forest Essentials

A category that had to be built before it could be sold

Forest Essentials launched in New Delhi in 2000 with Rs 2 lakh in capital, two employees, and a premise that had no precedent in Indian retail: that Ayurvedic skincare and haircare could be formulated to a luxury standard and priced accordingly. The category simply did not exist. India’s Ayurvedic products at the time were largely medicinal, mass-produced, or adulterated — “largely substandard,” Kulkarni later told Forbes India, calling the idea of a luxury Ayurvedic product “revolutionary” at the time. There was no supply chain to draw on, no formulation lab to license, no distribution template to copy. Everything — sourcing, manufacturing, formulation — had to be built from nothing.

The legal entity behind the brand, Mountain Valley Springs India Pvt Ltd, was itself a from-scratch construction rather than a licensed franchise or an imported product line. Where competing categories in Indian retail could lean on either mass manufacturing at the low end or imported luxury brands at the high end, Forest Essentials had to occupy a position — luxury, Indian, Ayurvedic, and formulation-first — that no existing supply chain was built to serve.

The company’s first products, beeswax candles infused with herbs, were exhibited at a trade show called Candlemania — an unglamorous opening act for what would become a pharmaceutical-grade manufacturing operation. The real test came after: nearly two years spent reformulating with nothing sellable, the business surviving on conviction rather than revenue while Kulkarni and her small team tried and discarded formulation after formulation. There was no shortcut available. Building a luxury category in a market that had no expectation of one meant the company had to become its own supplier, its own manufacturer, and its own quality standard before it could become a retailer.

The soap line that eventually emerged — still the brand’s bestseller a quarter-century later — was followed in 2002 by cold-pressed body massage oils, expanding the range beyond a single product category for the first time. The same year, Hyatt Regency Delhi placed the brand’s first large institutional order, a validation that mattered more than its size: a five-star hotel group was willing to put its name behind a two-year-old company with no retail footprint of its own. That hospitality relationship would eventually multiply into roughly 190 luxury hotel supply partnerships, including Taj and Oberoi alongside Hyatt — but in 2002, it was a single order from a single Delhi property, the first evidence that the category Kulkarni was building had commercial legs beyond her own store shelves.

The product range itself continued to widen in the years that followed. Ubtans — traditional pre-bath cleansing pastes formulated from botanical ingredients — and, in 2007, the Date & Litchi Youth Formula joined the soaps and body oils, building a portfolio broad enough to support the freestanding retail format Kulkarni was about to commit to.

The Khan Market bet

That footprint arrived in 2003, when Forest Essentials leased its first standalone store at Khan Market, one of Delhi’s most expensive retail addresses. The lease required a deposit the business could barely afford — an existential commitment for a company still finding its formulations. Kulkarni’s own accountant warned her against it. “We must try or we will never know,” he told her, before she signed the lease. Her own account of the decision, recorded years later in her autobiography, was blunter: “I had already made up my mind.”

The gamble paid off immediately. The entire opening stock sold out on day one, and within three months the store had established itself as a clear commercial success — proof that a market existed for the category Forest Essentials had spent two years trying to define. By 2005-06, the company had grown to Rs 6 crore in sales, evidence that the Khan Market bet was not a one-off but the foundation of a repeatable retail model.

What the Khan Market store proved, beyond its own revenue, was a template Forest Essentials would repeat at expanding scale over the next two decades: a flagship location, a curated but limited SKU range at the outset, and a pricing floor the brand refused to discount from even as competitors entered the category it had created. The freestanding-store format that grew out of Khan Market would eventually reach nearly 200 locations by the Estée Lauder Companies’ count, alongside the hotel-supply relationships that had begun with the Hyatt Regency order three years earlier.

An 18-year courtship, staged rather than sudden

The event that would eventually reshape Forest Essentials’ ownership structure happened almost by accident, seven years after the company’s founding. In 2007, Leonard Lauder received Forest Essentials products as a wedding gift while attending a celebration in Jodhpur. A meeting scheduled to run 30 minutes in Delhi stretched to two hours. The Estée Lauder Companies invested months later — not as an acquisition, but as an initial minority stake, reported at roughly 20% though ELC’s own primary disclosures describe it only as a “minority investment.” Founder control was unaffected.

That first stake proved to be the opening move in what became an 18-year staged transition rather than a single transaction. In 2020, ELC raised its holding to 49% — still short of control, with Kulkarni continuing to run the company as Managing Director. The pattern across both increases was consistent: capital and validation flowed in from a strategic partner, while day-to-day authority and brand direction stayed with the founder who had built the category from Rs 2 lakh and two employees.

On 5 March 2026, The Estée Lauder Companies announced an agreement, subject to regulatory approvals, to acquire the remaining approximately 51% of Forest Essentials — a deal expected to close in the second half of calendar 2026. As of the research date, there is no primary-source confirmation that the transaction has closed. Stéphane de La Faverie, ELC’s chief executive, framed the announcement as continuity rather than rupture: “Today marks a meaningful new chapter in a partnership built over the past 18 years on a foundation of mutual trust and respect.” Kulkarni remains Managing Director under the announced terms; her son, Samrath Bedi, holds the title of Executive Director. Headquarters, sourcing, and manufacturing all stay in India.

The structure of the deal is itself the story here as much as the outcome. A company acquired outright in a single transaction has one negotiation to get right; a company that sells in three tranches over eighteen years gets three. Each stage — the 2008 entry, the 2020 increase, the 2026 announcement — gave Kulkarni a fresh point at which to confirm that operational control, brand direction, and India-based manufacturing stayed intact before ceding more equity. That is a materially different sequence from a founder selling all at once under pressure, and it is the sequence a founder-controlled Ayurvedic brand with no prior institutional-ownership template had to invent for itself, deal by deal, over two decades.

Scale built on discipline, not discounting

By fiscal year 2025, Forest Essentials recorded Rs 578 crore in revenue — an 18% increase over the Rs 490 crore reported the previous year — with net profit of Rs 123 crore, up 71% year on year, for a net margin of roughly 22%, according to Registrar of Companies filings reported by Entrackr. The trajectory behind that figure has been steady rather than explosive: Rs 177 crore in FY18, Rs 253 crore in FY20, a dip to Rs 210 crore in FY21, and then a climb back to Rs 490 crore by FY24 en route to FY25’s Rs 578 crore.

The retail footprint supporting that revenue now runs to nearly 200 freestanding stores by ELC’s count — a figure that includes hotel, spa, and international points beyond the roughly 155 stores the company itself counts as India-only. Forest Essentials also supplies roughly 190 luxury hotel properties, including Taj, Hyatt, and Oberoi chains, and reports export reach to more than 120 countries. In November 2022, the brand opened its first store outside India, a flagship in London’s Covent Garden — proof that the luxury-Ayurveda category built for Delhi’s Khan Market could travel.

None of this scale came from discounting. Forest Essentials has maintained a no-discount pricing discipline since its earliest years, holding a luxury price tier — typically ₹3,000 and above — against a competitive field that has grown considerably more crowded than it was in 2000. Kama Ayurveda, in which the French group Puig acquired an 85% stake, competes directly in the premium-Ayurveda space; Biotique and Ranavat occupy adjacent positions; and a wave of mass-premium D2C actives brands — Minimalist, Dot & Key, and the broader Mamaearth family — has multiplied the number of options competing for the same shelf space. Above that tier again sit global luxury names — La Mer, Estée Lauder’s own core brand, Clinique — competing less on Ayurvedic provenance than on the same premium-beauty budget. Kulkarni’s own read on the crowding beneath her, given to Forbes India in 2025, was pointed: “I’m amazed to suddenly see these 30,000 brands… where have they come from… and they all look like clones of each other.” Forest Essentials’ answer to the clone problem has been the same one it gave in 2000 — vertical integration, from pharmaceutical-grade manufacturing at its Lodsi and Haridwar facilities in Uttarakhand through to retail, and a formulation philosophy Kulkarni has stated bluntly: if you cannot eat it, do not put it on your skin.

That manufacturing footprint is not incidental to the pricing discipline — it is what makes the discipline possible. Owning the pharmaceutical-grade production sites in Tehri Garhwal and Haridwar, rather than contracting them out, means Forest Essentials controls its own cost structure and ingredient sourcing end to end, without the margin pressure that a third-party manufacturer relationship would introduce. It is the same vertical-integration logic that let a two-employee, Rs 2 lakh startup in 2000 grow into a company posting a 22% net margin twenty-five years later — control of the supply chain converting into control of the price.

What the announced acquisition settles, and what it does not

The 18-year arc from a 2008 minority stake to a 2026 announced full acquisition answers one question definitively: Forest Essentials proved durable enough, and valuable enough, for a global beauty major to want all of it. What the announcement does not yet answer is the operational shape of what comes after closing — regulatory approval is still pending, and the deal is not confirmed closed as of the research date. What is confirmed is the continuity built into its terms: Kulkarni remains Managing Director, Samrath Bedi continues as Executive Director, and the company’s Indian headquarters, sourcing, and manufacturing stay in place. A staged ownership transition, unlike an abrupt sale, gives a founder eighteen years to negotiate exactly those terms — and Forest Essentials appears to have used them.

Last updated: July 31, 2026