Mamaearth parent makes quiet debut as shares stay level

Photo credit: Mamaearth

Honasa Consumer made its debut on the National Stock Exchange of India today in a highly anticipated IPO, making it the second company in the country’s booming beauty D2C space to go public after Nykaa.

But the share price of Honasa, which is the parent company of personal care brand Mamaearth, has remained relatively unchanged.

Honasa priced the IPO at 330 rupees (US$3.96) per share. At the time of writing, the number stood at 332.6 rupees (US$3.99).

2023 has been a record-breaking year for India’s IPO market, with over 180 companies going public so far. However, total proceeds are still down 15% compared to 2022.

Honasa previously set a target valuation of US$3 billion but later slashed it to around half due to current market performance. It filed a prospectus for the IPO in December 2022.

Founded in 2016 by husband-and-wife duo Varun and Ghazal Alagh, the company offers natural and toxin-free personal care products. It claims to have over 2.5 million customers across India and sells its products through online platforms and offline channels.

Honasa plans to use the net proceeds from the IPO for marketing and brand-building activities, investment in tech and digital infrastructure, and general corporate purposes, among others.

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Honasa grew its revenue from operations for financial year 2023 by 58.3% to around US$179.3 million, with its EBITDA margin staying positive at 2.98%. While in the black, its profits slid 71.4% to roughly US$480,000 in the same time frame, as costs crept up.

It became a unicorn in December 2021 after raising US$80 million round led by Sequoia Capital.

Currency converted from rupees to US dollar: US$1 = 83.26.