Honasa Consumer Ltd., the parent company of Mamaearth, The Derma Co., and Aqualogica, has been rated a ‘High Conviction Buy’ by ICICI Securities, highlighting the stock's potential for long-term upside based on robust fundamentals and sector-leading growth.
🔍 Why ICICI Securities Is Bullish on Honasa
✅ 1. Strong Brand Recall & Category Leadership
Mamaearth continues to dominate the toxin-free personal care category. Honasa’s strategy of targeting millennial and Gen Z customers through digital-first campaigns has built strong loyalty.
✅ 2. Expanding Offline Distribution
The company has rapidly scaled presence across general trade and modern retail, increasing offline contribution to revenue. ICICI notes this hybrid model is now delivering both volume growth and margin stability.
✅ 3. Margin Expansion in Sight
With scale benefits, Honasa is improving its gross margins via better sourcing, higher ASPs (average selling prices), and premiumization.
✅ 4. Diversified Brand Portfolio
The inclusion of The Derma Co., BBlunt, and Ayuga gives Honasa a multi-brand moat across skincare, haircare, and wellness categories.
✅ 5. Asset-Light & Agile
Honasa’s outsourced manufacturing model keeps it asset-light while enabling quick innovation and nimble market response.
💹 Stock Outlook & Valuation
Target Price (ICICI Sec Estimate): ₹550
CMP (As of July 1, 2025): ₹460 approx
Upside Potential: ~20% over next 12 months
Rating: BUY with high conviction
ICICI’s report adds that Honasa is among the best plays on premiumisation and direct-to-consumer (D2C) trends in India’s personal care segment.
🗣️ Management Commentary Highlights
Continued focus on digital content-led marketing
Commitment to sustainable formulations and eco-conscious packaging
Investment in AI-driven consumer insights to guide product development
🙋 FAQ –
1. Why is Honasa Consumer in focus now?
ICICI Securities has issued a high conviction 'Buy' rating citing strong fundamentals and brand momentum.
2. What is the price target for Honasa Consumer?
ICICI Securities has set a target of ₹550, indicating ~20% upside.
3. What are Honasa’s major brands?
Mamaearth, The Derma Co., Aqualogica, BBlunt, and Ayuga.
4. Is Honasa profitable?
Yes, Honasa turned profitable post-IPO and continues to improve its EBITDA and net margins quarter-over-quarter.
5. Should long-term investors consider Honasa?
Analysts suggest it as a solid long-term FMCG bet with digital growth potential and premium positioning.
published on 1st July
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