Shares of Honasa Consumer, the parent company of Mamaearth, surged 12.5 percent on Wednesday, August 13, following the announcement of its June quarter (Q1FY26) results. The rally was further supported by an upgrade from global brokerage CLSA after the company’s earnings release.
Honasa Consumer reported a 2.64 percent year-on-year (YoY) rise in consolidated net profit to ₹41.32 crore for the quarter ended June 2025, compared to ₹40.25 crore in the same period last year. Revenue from operations increased 7.4 percent to ₹595.25 crore from ₹554.05 crore in Q1FY25. However, EBITDA declined 0.7 percent to ₹45.9 crore from ₹46.1 crore, with margins narrowing to 7.7 percent from 8.3 percent a year ago. Gross profit margin, meanwhile, improved by 48 basis points to 71.2 percent during the quarter.
Total expenses rose 8.3 percent YoY to ₹563.55 crore, while total income grew 8 percent to ₹619.14 crore. Chairman and CEO Varun Alagh noted in the post-earnings analyst call that growth was impacted by an early onset of monsoon, particularly affecting the sunscreen category, which contributed to a 200 basis points drag on overall growth. Alagh said margins are expected to remain around 7 percent for the rest of FY26, with a focus on improving profitability by 100–150 basis points each year.
As of June 2025, Honasa had expanded its reach to approximately 2,40,113 FMCG retail outlets across India, marking a 20 percent YoY increase in distribution. Offline stores contributed about 15 percent to the company’s overall growth, supported by the addition of over 9,000 general trade outlets and 3,400 chemist stores. Mamaearth maintained double-digit growth in e-commerce, modern trade, and general trade channels during the quarter, with direct distribution rising 50 percent YoY.
Brokerage Views
CLSA upgraded Honasa Consumer to ‘Outperform’ and raised its price target to ₹333. The brokerage highlighted Q1 revenue growth of 7.4 percent YoY, in line with expectations, alongside underlying volume growth of 10.5 percent YoY. It noted the early monsoon’s negative impact on sunscreen sales but pointed to the company’s longer-term guidance of maintaining a 7 percent EBITDA margin in FY26 and expanding margins by 100–150 basis points annually over the next four to five years. CLSA also increased its FY26–FY28 earnings estimates by 15–26 percent.
Jefferies retained its ‘Buy’ rating on the stock with a price target of ₹400, citing a positive margin surprise. It acknowledged the revenue hit from unseasonal rains but noted that Honasa delivered sequential EBITDA margin improvement and exceeded expectations. Jefferies added that while new brands are growing slowly and Mamaearth has yet to fully recover, the flagship brand remains a key focus area for growth.
Stock Performance
The stock surged as much as 12.5 percent to touch its intraday high of ₹301.65. Despite the rally, Honasa Consumer still trades below its IPO price of ₹324. Over the past year, the stock has lost more than 40 percent of investor wealth, though it has gained 18 percent in 2025 so far. It remains 45 percent below its 52-week high of ₹546.50, recorded in September 2025, and above its 52-week low of ₹190, hit in April 2025.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
