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Parent Company Mamaearth’s Honasa Consumer Shares Rise 10% Following a 264% Increase in Net Profit in Q3

<p><strong>Mamaearth Shares Soar:</strong> Thanks to a solid December quarter performance, shares of Mamaearth parent Honasa Consumer surged by about 10% in today’s early transactions, to Rs 474.90 each.</p>
<p><img decoding=”async” class=”alignnone wp-image-399317″ src=”” alt=” parent company mamaearths honasa consumer shares rise 10 following a 264 increase” width=”1005″ height=”670″ title=”Parent Company Mamaearth's Honasa Consumer Shares Rise 10% Following a 264% Increase in Net Profit in Q3 6″ srcset=” 510w,–150×100.jpg 150w” sizes=”(max-width: 1005px) 100vw, 1005px” /></p>
<p>In the third quarter of the current fiscal year, the company’s net profit soared to Rs 26 crore, a three-fold increase from the previous year.</p>
<p>With Rs 488 crore in total revenue, it saw a 28% increase. However, successively reduced consumer demand affected the figures. Profit was up 12% and revenue was down 1.5% from the September quarter.</p>
<p>Its net profit for the first nine months of the current fiscal year increased to Rs 80 crore, a seven-fold increase.</p>
<p>Its consolidated sales reached Rs 488 crore in the December quarter, up 28% year over year. Additionally, there was a notable rise in the combined EBITDA, which increased by 192% YoY to Rs 34.5 crore, or 397 basis points.</p>
<p>In calendar year 23, the firm introduced 122 new products (NPDs), which greatly boosted its revenue growth. New product developments now make up a substantial portion of the company’s revenue during the first half of the year.</p>
<p>According to the company’s financial report, its product-specific efforts for Rosemary and Color Care, as well as its major ads like “Beautiful Ho Tum,” have greatly enhanced its brand visibility thanks to their eye-catching images and large viewership.</p>
<p>JPMorgan analysts downgraded the company to “underweight,” setting a target price of Rs 390 per share, which is 10% less than the firm’s most recent closing price.</p>
<p>We downgrade the company’s projected growth by 4/6 percent and perceive a negative risk to those projections. Although Honasa Consumer’s Q3 financials were in line with our expectations in terms of income, both sales and EBITDA were below expectations. In addition, the brokerage company said in a post-result assessment note that “the management sounds cautious amid increased competitive intensity and a soft demand environment.”</p>
<p>The whole amount spent by Honasa during the quarter was Rs 464.5 crore, which is an increase from Rs 378.5 crore and Rs 463.9 crore the previous quarter.</p>
<p>In 2023, the firm increased its omnichannel distribution to over 1.7 lakh touchpoints and introduced 122 new items. The distribution network had a YoY growth of 37%.</p>
<p>Compared to a percent fall in the benchmark Sensex, Honasa Consumer shares have dropped by more than 6% during the last month.</p>
<p>On January 23, 2024, Honasa Consumer shares reached a record high of Rs 510 per share.</p>
<p>JPMorgan analysts feel that the company is valued at a demanding 99x/70x price-to-earnings (PE) ratio for the fiscal years 25 and 26.</p>

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