Honasa share price: Mamaearth parent hits 20% lower circuit after poor Q2 results, slips below IPO price

The stock was trading at ₹297.25 per share, down 20%, its lower-circuit limit, on the NSE.

The company's market capitalisation stands at ₹9,655.39 crore.

The scrip is currently trading below its IPO price. On November 7, 2023, shares of Honasa Consumer Ltd were listed at a premium of 2% at ₹330 a unit over the issue price of ₹324.

Honasa Consumer Q2 loss at ₹18.57 crore

Honasa Consumer posted a consolidated loss of ₹18.57 crore for the second quarter of the financial year 2024-25 due to inventory correction.

In the year-ago period, the company had reported a net profit of ₹29.43 crore.

Revenue from operations descended 6.9% to ₹461.82 crore in the quarter under review compared to ₹496.1 crore in the corresponding period last year.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin was down 6.6% in Q2 FY25 and "with EBITDA Margin adjusted for inventory correction at 4.1%," the company said in its earnings statement.

Honasa Consumer Chairman and CEO Varun Alagh said over the last few months, the personal care firm has been working to optimise its distribution model.

"In this quarter, we have taken strategic steps towards transitioning from super-stockists to direct distributors in the top 50 cities. This transition has impacted our revenue and profits, leading to a slowdown for Mamaearth," he said.

However, he added, this realignment will also strengthen offline go-to-market strategy in the quarters ahead, setting the stage for the next phase of growth.

Honasa Consumer's total expenses stood at ₹506.21 crore, up 9.1% from the September quarter of FY24. The total income was down 4.24% to ₹481.84 crore.

Honasa Consumer Ltd is a personal care and beauty company operating digital-first brands such as Mamaearth, The Derma Co., Bblunt, Aqualogica, Dr Sheth’s, and Staze. With over 100,000 FMCG retail locations and a vast omnichannel distribution network covering more than 18,000 pin codes in India, the company's products are accessible to customers in 700+ districts across the country.