Honasa share price declines 20% following weak Q2 results
The share price of Honasa is now trading below its IPO issue price of Rs 324
The share price of Honasa Consumer, the parent company of , crashed by 20% on Monday morning as the stock market reacted negatively to the losses reported by the company for the second quarter of the fiscal.
The shares of Honasa Consumer are now trading at Rs 297.25 on the NSE, which is a 20% decline when compared to its Friday closing of Rs 371.55 per share. Additionally, this fall in share price brings its lower than the IPO issue price of Rs 324 when it got listed on November 7, 2023 .
On November 14 this year, Honasa announced its second quarter financial results where it reported a loss of Rs 18.71 crore as against a profit of Rs 29.78 crore in the similar period a year ago. Similarly, the company's revenue declined by 7% on a year-on-year basis to touch Rs 461.82 crore for the second quarter of FY24.
The company attributed this drop in revenue and slipping into losses primarily due to the challenges arising from its distribution model, which was primarily due to its inventory management. Also, Honasa Consumer saw certain growth challenges in its flagship brand Mamaearth with a dip in sales.
"We have recognised that there are a few strong tweaks that we need to make across the mix from a product mix perspective in terms of SKU sizing that needs to be promoted and on communication perspective where we need to become sharper," Honasa Consumer CEO Varun Alagh said post the quarterly results.
Honasa is also the parent company of popular brands like The Derma Co, Aqualogica, Dr Sheth’s, and BBlunt.
Edited by Megha Reddy