Honasa Consumer, which owns and operates India's most-loved consumer brands in Beauty & Personal Care Mamaearth, reported 265% growth in its consolidated net profit for Q3 earnings as compared to Rs 7.13 crore during the corresponding quarter of the previous year on the last trading session of last week.
The company posted a rise of 27.8 percent in income from operations at Rs 488.22 crore, as against Rs 382.16 crore during the third quarter of FY23.
On the occasion of the earnings release, the CEO and Charman of Honasa Consumer said, “The Q3 result is a testimony of our deep understanding of the beauty market in India. As we move ahead to capture this market further, our innovation-driven brand-building playbook uniquely positions us to identify many opportunities to continue our growth trajectory. Four out of six brands from our portfolio are already in the Rs 150 crore ARR club, and we see this as a testimony to our capabilities. Having built color care with Mamaearth showcases our ability to build new categories and the versatility of the brand. As we move forward, focus continues to be on purpose-based brand building, innovation, and distribution expansion.”
As per quarter third earning honasa, consumer revenue growth witnesses 11x higher revenue growth as compared to the median growth of FMCG companies.
As per the earning presentation the company has stated few point macro-economic factors that is driving consumption in India and those factor are as follows :-
- Rising incomes resulting in higher consumption
- Rising incomes leading to a large middle-class population – key driver of private consumption
- Increasing participation of women in labour force, particularly services
- Growth bolstered by India’s young population with millennials and generation Z likely to become a major consumption pool
The company's gross profit margin percentage was reported to be 200 basis points lower at 68.6%; however, the company has tightened its other expenses and also trimmed its advertisement expenses as a percentage of revenue, with further projects to grow to 47% by 2027. The company is moving toward primiarization, from mass to masstige, and also shifting its focus to premium products. The company has seen growth from 33% in the masstige segment in 2016 to 40% in 2022. The company expects the masstige segment to grow 2x+, as the majority of their brands cater to the masstige segment. The company is cutting its unorganized offline channel and shifting toward an online channel of sales.
Following the earnings announcement, the stock made a gap-up opening and is trading at Rs. 440. The stock has given a return of approximately 38% since the date of listing on November 10, 2023.
