After a challenging phase of distribution realignment, Honasa Consumer is back on a strong growth path, according to international brokerage Jefferies. Investor sentiment reflected this optimism on Friday, with the stock surging over 10% after the company reported a robust Q4 FY26 performance.
The company reported an impressive 177% year-on-year (YoY) jump in consolidated net profit to Rs 69 crore for the fourth quarter of the financial year 2026, from Rs 25 crore in the year-ago period. Honasa’s revenue from operations jumped over 23% YoY to Rs 657 crore during Q4 of FY26, compared to Rs 533 crore reported in the corresponding quarter of FY25.
Jefferies, which has set a target price of Rs 565, implying a 57% upside from the previous close, said Honasa Consumer continues to deliver strong growth across channels. Its focus categories grew over 20% in e-commerce and more than 30% each in modern trade offtakes and general trade secondary sales, the brokerage noted.
The brokerage noted that the company’s modern trade outlet reach has crossed 10,000 stores, while general trade remains one of the fastest-growing channels, supported by improved store execution, better distribution quality and automated ordering systems that are helping expand presence across existing as well as new outlets.
On the outlook, Jefferies expects EBITDA margins to improve by 100 basis points annually, driven by operating leverage and lower operating expenses, including advertising spend optimisation. It added that innovation and product re-innovation continue to remain key focus areas for the company.
Jefferies further noted that Honasa has already taken product price hikes to offset raw material inflation and does not expect any material impact in the first quarter, with no further price hikes planned at present. The company also announced its first dividend since listing, which "signals management’s belief in the company's ongoing cash-generating capability."
Hong Kong-based brokerage CLSA maintained its “Outperform” rating on the stock with a target price of Rs 434 (21% upside). Analysts highlighted three key takeaways from the quarter. First, Mamaearth delivered growth in the teens, and management expects double-digit growth momentum to continue. Second, offtake growth in both general trade and modern trade rose 30% year-on-year, indicating improving brand traction. Third, operating leverage, despite a softer base, helped EBITDA exceed expectations by more than 140 basis points.
Also read: Honasa Consumer shares zoom 11% on robust Q4
The brokerage said Honasa still has a ‘long runway’ for scaling brands through its focus categories and hero products. It also noted that execution of the Mamaearth turnaround continues to improve, and it expects margin expansion to sustain going ahead.
ICICI Securities has pegged the target at Rs 500, a 39% upside from the current levels. The brokerage reiterated Honasa Consumer shares as its top pick within the consumer space, saying the key debate around the stock over the past 12-18 months had been whether Mamaearth could return to sustainable growth while simultaneously building a wider portfolio beyond its flagship brand. According to the brokerage, Q4FY26 addressed both concerns effectively. It highlighted that Mamaearth delivered growth in the teens, focus categories grew more than 35%, younger brands expanded over 40%, and The Derma Co. continued to maintain a double-digit EBITDA profile, underscoring the strength of the company’s House of Brands strategy.
The brokerage also pointed to improving market share trends, strong traction in hero products and better offline execution, which suggests that growth is becoming increasingly diversified and less reliant on any single brand or channel. Going ahead, it expects the next phase of growth to be driven by leadership in focus categories, scaling up of younger brands, operating leverage and deeper offline penetration.
JM Financial maintained its “Buy” rating on Honasa Consumer and raised the target price to Rs 420 from Rs 375, implying an upside of 16.3%. The brokerage highlighted that key positives from the quarter included mid-teen sales growth in Mamaearth, while younger brands continued to sustain strong momentum with growth of over 30% year-on-year.
Also read: Honasa Consumer Q4 results: Profit more than doubles to Rs 69 cr; co declares Rs 3 dividend
According to the brokerage, the initiatives aimed at reviving growth in Mamaearth and scaling up younger brands are delivering promising results on revenue growth, while working capital continues to remain negative. JM Financial also believes that faster growth in the higher-margin Mamaearth brand and the scaling up of younger brands provide sufficient levers for further margin expansion going forward.
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