Honasa Consumer Stock EXPLODES 7% on Q2 Beat! Jefferies Signals MASSIVE 58% Upside – Here's Why!

Consumer Products

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Updated on 13 Nov 2025, 05:46 am

Honasa Consumer's stock surged by approximately 7% in early trading, buoyed by its steady performance in the second quarter and positive commentary from analysts. Jefferies, a prominent brokerage firm, reaffirmed its 'Buy' rating for the company, assigning a target price of Rs 450 per share, which suggests a potential upside of as much as 58% over a 12-month horizon. The brokerage highlighted that the Q2 results confirmed Honasa Consumer has moved past its consolidation phase, supported by an unexpected margin improvement and a stabilizing growth trajectory.

Key performance indicators for the quarter included consolidated revenue growth to Rs 538.1 crore from Rs 461.8 crore in the prior year. After adjusting for Flipkart's revised settlement policy, underlying revenue growth was closer to 22.5%. Margins saw a significant boost, with gross margins rising to 70.5% and EBITDA margins reaching 8.9%, the highest in several quarters, driven by stable advertising spend. The flagship brand, Mamaearth, returned to positive growth after several quarters of decline, with management projecting further acceleration. Younger brands such as Aqualogica and Dr. Sheth's also posted over 20% year-on-year growth. The company's offline expansion has been robust, crossing 2.5 lakh retail outlets, with direct distribution now forming a substantial part of its footprint. Quick commerce also emerged as a fast-growing channel contributing nearly 10% of revenue.

Despite risks like intense competition and execution challenges in offline expansion, Jefferies believes Honasa Consumer has improved its operational discipline. The company's financial outlook indicates a recovery in EBITDA margins and a reduction in advertising intensity over the next few fiscal years.

Impact This news is significant for Honasa Consumer shareholders and investors interested in the Indian consumer goods sector. The strong Q2 performance and positive brokerage outlook are likely to boost investor confidence, potentially driving the stock price higher. It validates the company's strategy of diversifying revenue streams through offline channels and premiumization, setting a positive tone for the sector. Rating: 7/10

Difficult Terms Explained EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization. This metric measures a company's core operational profitability. Gross Margin: The percentage of revenue that remains after deducting the cost of goods sold. It indicates profitability from the sale of products. Ad Intensity: The proportion of a company's revenue spent on advertising and promotional activities. Premiumisation: A business strategy focused on offering higher-priced, premium-quality products to target affluent consumers. Traction: The progress or development made by a company, product, or idea. Quick Commerce: A rapid delivery service, typically offering delivery within minutes, for essential goods and other items. Marketplaces: Online platforms where multiple sellers offer their products, such as Amazon or Flipkart.