Honasa Consumer projects up to Rs 1,000 Cr ARR in 3-5 years across brands
In FY 23-24, Honasa Consumer achieved like-for-like growth of 31.6%, generated free cash of Rs 224 crore, and had a negative working capital cycle of minus 13 days.
Honasa Consumer Limited, the parent company of brands such as , , , Dr. Sheth’s, and , has outlined a path to growth over the next 3-5 years.
The company expects The Derma Co. to reach Rs 1,000 crore annual revenue rate (ARR) while Aqualogica and Dr. Sheth’s are targeted to reach Rs 500 crore ARR. The company projects the haircare brand BBlunt to join the Rs 250 crore ARR club during the period.
It noted in a statement that its multi-brand strategy has resulted in capturing over 30% market share in the sunscreen category across key ecommerce platforms and D2C channels.
According to the annual report, Honasa has expanded its distribution channels to cover over 97% pincodes and serves 719 districts in India through its websites and ecommerce platforms. Additionally, the company has strengthened its offline presence, reaching 1,88,377 FMCG retail outlets, marking a 34% year-on-year increase.
"We've significantly increased household penetration in India, particularly in the face wash and shampoo categories, by 290 bps and 110 bps, respectively. Our value market share has also seen substantial growth in these categories," said Ghazal Alagh, Co-founder of Honasa Consumer Limited.
In FY24, it achieved like-for-like growth—a measure of growth in sales—of 31.6%, generated free cash of Rs 224 crore, and had a negative working capital cycle of minus 13 days, the report reads.
Distribution expansion
Honasa has seen significant growth in its offline presence, with contributions increasing from approximately 9% in FY 19-20 to about 35% in FY 23-24, it noted in its annual report. The company’s offline channels include general trade outlets, modern trade chains, and exclusive brand outlets.
The report noted that its offline distribution network includes over 600 distributors, super-distributors, and sub-stockists. Additionally, Honasa has implemented a distributor management system and Sales Force Automation tools to enhance control and execution.
"Transitioning to direct distributorship in the top 50 cities has allowed us to improve retailer connections and in-store execution. This strategy not only drives cost efficiencies but also strengthens our long-term partnerships with Tier I distributors," said Honasa Consumer Co-founder and CEO Varun Alagh.
The company's omnichannel distribution model, which involves online product launches to gauge consumer response and build brand traction, has allowed it to scale its offline channel to over Rs 600 crore.
"Our strategy of identifying the right geographies for offline expansion, based on consumer pull and feedback, has been instrumental in our growth," Varun added.
Edited by Kanishk Singh