Shares of this new-age beauty stock dropped over 6 percent to Rs.490.15 per share after a block deal on Thursday transferred 10.9 percent of the equity, worth Rs.1,763.3 crore.
Share Price Movement
In Thursday’s trading session, Shares of Honasa Consumer, parent of Mamaearth the beauty-care startup fell nearly 5.67 percent to an intraday low of Rs.490.15 per share from its previous close of Rs.522 apiece. The price has since recovered and is now trading at Rs.495.35 per share.
Reason for the fall
On Thursday, a block deal involving Honasa Consumer saw 10.9 percent of the company’s shares, amounting to 3.5 crore shares, sold by shareholders including Sequoia Capital, Peak XV Partners, Redwood Trust, Fireside Ventures, Stellaris Ventures, and Sofina Ventures, according to a CNBC-TV18 report citing sources.
According to the report, the floor price for the Honasa Consumer block deal was likely set at around Rs.500 per share, bringing the total transaction value to approximately Rs.1,763.3 crore.
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This floor price represents a discount of over 4 percent compared to Wednesday’s closing price of Rs.522 per share. Kotak Securities and Jefferies India are expected to be the brokers for the block deal.
As of the quarter ending June 2024, Peak XV Partners held an 18.69 percent stake in Honasa Consumer, Sequoia Capital owned 4.35 percent, and Fireside Ventures had a 4.28 percent stake. Sofina Ventures held 5.16 percent, and Stellaris Ventures owned 4.75 percent of Honasa Consumer at the end of the June quarter.
Brand Portfolio
Honasa Consumer Limited encompasses several brands, including Mamaearth (natural personal care), The Derma Co. (science-backed skincare), Aqualogica (hydration-focused products), BBlunt (hair care), Dr. Sheth’s (Ayurvedic skincare), and Ayuga (modern Ayurveda).
These brands cater to diverse consumer needs, emphasizing safety, efficacy, and natural ingredients.
Financial Performance
In its latest financial update, Honasa Consumers Ltd reported net sales of Rs.498 crore for Q1 FY25, a 17 percent increase from Rs.426 crore in the same quarter last year. Moreover, the company’s net profit for the quarter was Rs.35 crore, up from Rs.28 crore in Q1 FY24, reflecting a 25 percent increase.
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Company Overview
Honasa Consumer Limited is a digital-first house of brands, primarily focusing on beauty and personal care products, with notable brands like Mamaearth, The Derma Co., and Aqualogica. Founded in 2016, it has quickly become a leader in the Indian market by offering natural, toxin-free products tailored to millennial consumers’ needs.
Written by – Siddesh S Raskar
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