ICICI Securities has increased its target price for Honasa Consumer to ₹720, citing a strong first quarter for fiscal year 2027. The company reported a 32% jump in like-for-like revenue and a significant rise in profit, driven by the recovery of the flagship Mamaearth brand and growth in its newer portfolio.
Honasa Consumer, the parent company behind the popular skincare brand Mamaearth, has received an updated outlook from brokerage firm ICICI Securities. Analysts at the firm have raised their target price for the stock to ₹720, up from the previous target of ₹600, following a robust performance in the first quarter of the 2027 fiscal year.
The company’s latest financial results provided a boost to investor sentiment, highlighting strong growth in both its flagship and newer brands. Honasa reported a 31.8% year-on-year increase in like-for-like revenue, with reported revenue for the quarter coming in at ₹756 crore. Profitability also showed a marked improvement, with the company’s net profit more than doubling year-on-year to ₹90 crore.
Operational Growth and Key Milestones
A central theme in the positive assessment is the effectiveness of the company’s "House of Brands" strategy. The strategy aims to scale smaller brands alongside Mamaearth. During the quarter, The Derma Co., one of the company's newer brands, crossed the milestone of ₹1,000 crore in annual recurring revenue. This diversification suggests that the company is successfully reducing its reliance on a single brand to drive growth. Earnings before interest, taxes, depreciation, and amortization (EBITDA) also grew significantly, rising approximately 2.5 times year-on-year to ₹110 crore, with margins expanding to 14.1%.
It is important to note that the company’s revenue reporting included a variance of ₹29 crore. This change was attributed to an adjustment in the settlement mechanism with the Flipkart group. While this affected the reported revenue figures, the company maintained that underlying profitability remained steady, a point that analysts are closely evaluating to ensure long-term consistency.
Challenges and Market Context
While the financial results indicate strong momentum, the beauty and personal care market in India remains intensely competitive. Honasa Consumer faces a complex balancing act as it seeks to grow its offline distribution network. Expanding from a digital-first model to a broader retail presence brings execution risks, including potential cost pressures that could weigh on margins.
Investors may also track whether the company can maintain the growth momentum of its flagship Mamaearth brand while simultaneously scaling smaller, newer brands. As the market for beauty products matures, the ability to protect market share against both established multinational giants and new, agile startups will be critical.
The next important update for investors will be the sustainability of these margins as the company scales its offline operations. Tracking the revenue growth of the newer portfolio brands versus the core Mamaearth business will also provide a clearer picture of whether the "House of Brands" strategy can deliver consistent long-term results.