India offers huge potential growth for giant global consumer-goods businesses Unilever (NYSE:UL), Procter & Gamble (NYSE:PG) and Colgate-Palmolive (NYSE:CL). India is known as one of the fastest-growing consumer markets, along with China, Indonesia, and Vietnam. According to Deloitte, two main factors drive India's growth. First is the rapid rise of India's middle class, while second is the income level of the Indian middle class. By 2020, Deloitte expects India to have the third-largest middle class consumer market, behind the USA and China. India's aggregated consumer spend could reach $13 trillion by 2030. 

Unilever will tap into the Indian rural market
In the consumer market in India, Unilever has a big edge over its peers with Hindustan Unilever. Hindustan Unilever trades on the Indian stock market with a total market capitalization of $19.5 billion. In the middle of 2013, Unilever made a bold move by increasing its stake in Hindustan Unilever from 52% to more than 67%, with a total transaction value of EUR 2.49 ($3.2) billion.  

Unilever's bid to raise its stake in Hindustan Unilever valued the company at 37 times its EBITDA (earnings before interest, taxes, depreciation, and amortization). This price seems quite expensive compared to similar deals that occurred at an average EBITDA multiple of only 10.8.

The rationale behind the recent investment in India was to tap into the rural India region, which has a population of more than 800 million, and is what Unilever considers to be the biggest growth opportunity for the company. According to Unilever's CEO Paul Polman, because rural India has more than twice the population of Western Europe, the company could grow the business by six to eight times just via the rural market in India. Moreover, rural markets will grow much faster than urban markets, so growth could accelerate much quicker.

Procter & Gamble does not want to be left behind
Unilever's head-to-head competitor Procter & Gamble does not want to stay behind Unilever in the Indian consumer market. With several strong brands such as Pantene, Whisper, Olay, and Tide, P&G's India business has managed to grow its sales at more than 20% annually to reach $1 billion in total turnover. 

In the past two years, P&G has invested Rs 2,000 crore ($322 million) to expand its existing factories and build up a new multi-product plant to increase local production in India. Recently, P&G also announced that its P&G home products operation will borrow INR 1,500 crore ($242 million) in the form of an inter-company loan to enhance the overall operating performance of the Indian business. 

During the next five years, Procter & Gamble will invest $1 billion in India to enhance its long-term sustainable growth advantage in this market.

Colgate-Palmolive is the leader in oral care in India
Colgate-Palmolive also sees big growth in its Indian business. The company is the market leader and controls around half of the Indian oral care market. In the third quarter of fiscal 2013, its toothpaste market share rose 80 basis points to reach 54.3% in the Indian market, driven by several premium-priced products such as Colgate Visible White. Its manual toothbrush share also increased by 250 basis points to 42.2% in India, while its regional mouthwash saw market share up by 40 basis points to 20.2%. 

My Foolish take
The Indian consumer market gives these three global consumer products companies huge opportunities for future growth. With their established, leading positions, Unilever, Procter & Gamble, and Colgate-Palmolive could successfully take advantage of the rise in India's middle class income to drive their global businesses forward. Unilever sees the big potential in the Indian rural market, and the company's recent step to increase its stake in Hindustan Unilever could really help it see future benefits by tapping into this fast-growing market.