Honasa Consumer Ltd

Financial Performance

• Q1 FY27: 32% revenue growth; EBITDA ~INR110 crores; PAT INR90 crores.
• Volume growth 30.5%; cash generation ~INR83 crores; negative working capital.
• EBITDA uplift driven by mix benefits, A&P efficiency, and one-time opex benefit.

Portfolio & Brand Update

• Fragrance category entered; launched FIKN elixir-based brand with 12-hour stay.
• Second INR1,000-crore brand; Derma Co. offline traction; BTM Ventures ARR ~INR150 crores.
• Focus categories contributed ~85% of Q1 FY27 revenue.

Channel & Distribution

• GT and modern trade show share gains; face washes +350 bps; shampoos +160 bps.
• E-commerce growth >20%; emphasis on focus categories, quick commerce, and tier-2 geographies.
• Derma Co. distribution around 50,000 outlets; 80% online, 20% offline.

Margin & Cash Flow

• Q1 EBITDA margin ~12% (excluding one-time piece); seasonal lift ~50 bps.
• Management targets 100–150 bps annual margin expansion to 15% in five years.

Guidance & Outlook

• Five-year plan prioritizes growth over margin; core profitability to support new categories/brands.
• A&P spend to grow with profitable channel mix and brand momentum.

Q&A Highlights

• Growth trajectory: five-year high-teens CAGR; some years above the baseline.
• Mamaearth to deliver double-digit CAGR over five years; trajectory may vary year to year.
• QC data: category-level share tracked with partner data; not third-party audited.
• Younger brands: restage for Aqualogica; 6–9 month sharpening; planned actions for BBlunt, Dr. Sheth's.
• Margin discipline: prioritizing growth; Q2 seasonality may affect quarterly mix; reinvestments planned.
• Offline reach: INR3 lakh universe per AC Nielsen; Derma Co. growing offline with strong online contribution.

Transaction details

• Target Company: Honasa Consumer Limited.
• Disclosing Party: ICICI Prudential Life Insurance Company Limited; not in promoter group.
• Transaction Type: Disposal of voting shares.
• Pre-Transaction Holding: 18,914,816 shares, 5.80%.
• Transaction Details: Sold 892,850 shares (0.27%) via open market on Aug 14, 2026.
• Post-Transaction Holding: 18,021,966 shares, 5.53%.
• Date of Transaction: August 14, 2026.
• Share Capital Context: Equity share capital before/after: 326,024,216 shares of ₹10.
• Total diluted share capital after: 326,024,216 shares.

Meeting details

• Date of call: August 13, 2026.
• Type and mode: Earnings conference call; mode not specified.
• Event/organiser: Honasa Consumer Limited.
• Purpose: Discuss unaudited Q1 June 30, 2026 results.
• Key participants: Company Secretary and Compliance Officer.
• Recording: audio recording available on company website.

Issue Overview

• IPO of equity shares; no other security types.
• Total issue size and net proceeds reported; no revision or undersubscription.
• Main objectives: brand advertising, capex for EBOs, BBlunt investment, and GCP/unidentified acquisitions.

Utilisation of Proceeds

• Utilisation as disclosed: no deviation from the Offer Document.
• Advertisement expenses: fully utilised; no idle funds.
• Capex for EBOs: partially utilised; remaining funds idle.
• Investment in BBlunt: partially utilised; remaining funds idle.
• General corporate purposes: fully utilised.
• Unidentified inorganic acquisitions: fully utilised.
• GCP allocations: 87.623 Cr general; 34.269 Cr acquisitions utilised.
• Reimbursement from monitoring account for inadvertent Q3 FY26; reversed Feb 2026.
• Unutilised proceeds held in fixed deposits and monitoring accounts; total around 29.66 Cr.
• Current unutilised investments across banks; interest earned credited to value.

Governance and Compliance

• Government/statutory approvals not applicable for these objects.
• No material events affecting viability reported.

General Corporate Purpose

• GCP total utilisation: 121.892 Cr.
• GCP sub-heads utilised: 87.623 Cr general; 34.269 Cr acquisitions.

AGM Details

• AGM date: Monday, September 28, 2026; held via Video Conferencing/Other Audio-Visual Means.
• e-voting cut-off date: Monday, September 21, 2026.
• Record date for final dividend: Friday, August 28, 2026.

Dividend

• Final dividend of ₹3 per equity share for FY2025-26, subject to AGM approval.

Notice & Circulation

• Notice and Annual Report for FY2025-26 will be circulated to members in due course.

Key Highlights

• Q1FY27 revenue reached INR 785 Cr, up 31.8% YoY; highest-ever quarterly revenue.
• Q1FY27 EBITDA INR 110 Cr; margin 14.1%; ~2x YoY.
• PAT rose to INR 90 Cr; PAT margin 11.5%.
• Focus Categories grew 35%+; Mamaearth growth in high-teens; cross-channel demand.
• Derma Co. NSV ARR hit INR 1,000 Cr; entered teens EBITDA club; two INR 1,000 Cr brands.
• Younger Brands grew ~40%+; BTM Ventures ARR crossed INR 150 Cr; expanding geography and channels.
• Offline scaled; General Trade and Modern Trade ~40%+ growth; outlets ~3 lakh.
• Entered fragrance category with FIKN, India's first elixir brand.

Business overview

• Honasa Consumer is a beauty & personal care player with Mamaearth, The Derma Co, Aqualogica, Dr Sheth's.
• Multi-channel model combining offline, modern trade, and online platforms.

Operational highlights

• Focus categories grew 35%+; momentum across General & Modern Trade.
• The Derma Co reached INR 1,000 Cr NSV ARR.
• Face Cleansers crossed INR 200 Cr ARR.
• Mamaearth brand searches rose 34% YoY.
• Outlets expanded to ~3 Lakh; Modern Trade reach above 90%.

Financial performance

• Revenue from operations: INR 756 Cr in Q1 FY27.
• YoY revenue growth: 27.0%.
• Gross profit: INR 527 Cr; gross margin 69.7%.
• EBITDA: INR 110 Cr; EBITDA margin 14.6%.
• PAT: INR 90 Cr; PAT margin 12.0%.
• Revenue recognition impact: INR 29 Cr topline; no bottom-line impact.
• Cash generation: negative working capital cycle.

Capital structure & liquidity

• Cash generating business with negative working capital cycle.

Strategic priorities & outlook

• Focus categories to sustain momentum across channels.
• Expansion of offline/modern trade and eCommerce reach.
• New product innovations launched in Q1 FY27.
• Outlook: continued double-digit growth across brands.
• NSV ARR milestone supports growth runway.

Financial results

• Approved unaudited standalone and consolidated results for quarter ended June 30, 2026.
• Consolidated revenue Rs 7,559.46 million; standalone revenue Rs 6,963.18 million.
• Consolidated PAT Rs 904.48 million; standalone PAT Rs 843.12 million.
• Total comprehensive income: consolidated Rs 901.88 million; standalone Rs 839.18 million.
• Consolidated EPS Rs 2.77 (basic), Rs 2.76 (diluted).
• Standalone EPS Rs 2.59 (basic), Rs 2.58 (diluted).
• Paid-up capital increased to Rs 3,260.24 million due to 654,422 shares.
• 574,400 ESOPs granted in the quarter.
• IPO proceeds utilization up to June 30, 2026: Rs 3,208.34 million.

Strategic actions & subsidiaries

• Fluence Pharma acquisition approved: 58% stake; 42% in two tranches over 5-7 years.
• Honasa Health Private Limited incorporated; wholly owned subsidiary for B2C nutraceuticals; effective July 7, 2026.
• Acquisition has no impact on the June 30, 2026 results.

Dividends & share capital

• Final dividend recommended: Rs 3 per equity share; subject to AGM approval.

Labour codes impact

• Labour Codes impact recognised: Rs 47.97 million past service cost in FY2026.

Legal & regulatory matters

• Final UAE award: RSM to pay Rs 255.36 million; injunction against Dubai proceedings.