Author: Prashant Marathe
Date: 23 May 2025
CMP: ₹317 (🔼 +15% Today)
MCap: ₹10,320 Cr
Auditors: S.R. Batliboi & Associates LLP
Audit Opinion: ✅ Unmodified
📌 At a Glance
Honasa Consumer Ltd — the company behind Mamaearth, The Derma Co., Aqualogica, BBlunt — has pulled off something few D2C brands manage:
✅ ₹726 Cr profit
✅ ₹2.24 EPS
✅ Zero traditional debt
✅ And a 15% rally in one day post results.
🧾 FY25 Financials (Consolidated)
| Metric | FY25 | FY24 | YoY Growth |
|---|---|---|---|
| Revenue from Ops | ₹2,066.9 Cr | ₹1,919.9 Cr | 🔼 +38% |
| Total Income | ₹2,145.7 Cr | ₹1,969.6 Cr | 🔼 +36% |
| Net Profit | ₹726.87 Cr | ₹487.6 Cr | 🔼 +49% |
| EPS (Diluted) | ₹2.23 | ₹1.53 | 🔼 +46% |
| EBITDA (Est.) | ₹896.13 Cr | ₹675 Cr | 🔼 +32% |
| Ad Expenses (Est.) | ₹1,185 Cr+ | ₹1,031 Cr+ | 🔼 +15% |
📆 Quarterly Trend (Q4 FY25 Focus)
| Quarter | Revenue (₹ Cr) | Profit (₹ Cr) | EPS (₹) |
|---|---|---|---|
| Mar 2025 | ₹554.35 | ₹24.98 | 0.77 |
| Dec 2024 | ₹536.72 | ₹26.02 | 0.80 |
| Sep 2024 | ₹487.52 | ₹-14.92 | -0.46 |
| Jun 2024 | ₹567.68 | ₹34.79 | 1.07 |
They rebounded impressively after Project Neev disruptions in Q2 — when they overhauled their general trade distribution.
📊 Balance Sheet Breakdown
| Item | FY25 (₹ Cr) | FY24 (₹ Cr) | Change |
|---|---|---|---|
| Total Assets | 17,901.39 | 16,320.44 | 🔼 +9.7% |
| Equity (Net Worth) | 11,798.30 | 10,952.71 | 🔼 +7.7% |
| Cash + Bank | ₹3,313 Cr | ₹4,856 Cr | 🔽 –31.8% |
| Trade Receivables | ₹1,323 Cr | ₹1,593 Cr | 🔽 –17% |
| Inventories | ₹1,582 Cr | ₹1,228 Cr | 🔼 +29% |
| Intangibles (Brand IP + GW) | ₹1,553 Cr | ₹1,545 Cr | ⏸️ Stable |
| Trade Payables | ₹3,567 Cr | ₹2,941 Cr | 🔼 +21% |
| Lease Liabilities | ₹1,364 Cr | ₹1,310 Cr | ⏸️ Stable |
EduView: Efficient working capital. Inventory up due to retail push. Receivables down = cash collected faster. But cash reserves have dipped — because they poured money into working capital, ads, and capex.
🧾 Auditor Verdict
- Auditor: S.R. Batliboi & Associates LLP
- Opinion: ✅ Unmodified
- Coverage: Includes India + UAE + Indonesia subsidiaries
- Note: ₹576 Cr UAE distributor legal battle disclosed — but no P&L impact due to court stay.
⚖️ Legal Overhang: The RSM UAE Drama
- Ex-distributor RSM Trading LLC sued Mamaearth in Dubai.
- UAE court ordered ₹576 Cr payment.
- Indian courts stayed the ruling, arbitration started in India.
- Mamaearth expects no financial hit as of now. 🚫💸
This could turn nasty — or disappear quietly. Keep an eye.
🧠 EduInvesting Take
Mamaearth isn’t just clean beauty — it’s now clean profitability.
- They’ve moved from just branding → to execution
- Q2 was weak, but bounce back was strong
- IPO cash usage is transparent (₹1,710 Cr used from ₹3,504 Cr planned)
Most importantly: it’s not burning money anymore. Ad spend as % of revenue is falling, even as sales grow.
⚙️ Key Drivers for FY25
- Project Neev: Direct GT distribution → higher efficiency, more margin retention
- BBlunt + Cosmogensis acquisition: Strengthens R&D and offline push
- Strong cash balance = runway for future D2C launches
- Zero net debt: Only lease liabilities; no traditional loans
⚠️ Risk Radar
- Legal battle overhang (UAE)
- P/E of 141x → still expensive
- Brand-driven business = vulnerable to ad fatigue
- Heavy reliance on one category (skin/hair care)
- High intangible assets on books
🔮 Fair Value Peek (FV Estimate)
Assume:
- FY26 Net Profit = ₹1,000 Cr
- Assign P/E = 45x (high growth FMCG range)
→ FV Market Cap = ₹45,000 Cr
→ Implied FV per share = ₹138
→ CMP ₹317 = 2.3x forward FV
Verdict: This is priced for perfection. Buy only if you believe in 30% CAGR ahead.
🧠 Final Edu Verdict
Mamaearth was once a meme stock. Now? It’s a serious FMCG story with D2C tech DNA.
But the valuation still thinks it’s L’Oréal 2.0.
If you’re in, hold tight. If you’re out, wait for a price dip.
This one’s not going to be cheap — but it might just earn it.
🏷️ Tags
Honasa Consumer, Mamaearth Results, FY25 Earnings, Project Neev, UAE Legal Case, EduInvesting, D2C Stocks India, Beauty Sector, FMCG India, EPS Growth Stocks
