Honasa Consumer Ltd, the holding company of D2C unicorn Mamaearth, experienced a 20% surge in its shares during Thursday’s intraday trading. The stock reached a record high of INR 422.5 on the BSE after the company disclosed its Q2 FY24 earnings.
On Wednesday, Mamaearth reported a profit after tax (PAT) of INR 29.4 Cr in Q2, demonstrating a substantial 94% year-on-year (YoY) increase. Simultaneously, its operating revenue saw a growth of 21%, reaching INR 496.1 Cr.
In fact, there seems to be an overall improvement in the company’s financial performance. In the previous fiscal year (FY23), Mamaearth had incurred a loss of INR 151 Cr. Although the startup’s performance for the entire fiscal year is yet to be observed, it has reported a profit after tax (PAT) of INR 54.1 Cr in the first half of FY24.
The startup reported that 40% of its revenue growth originated from online operations, with revenue from offline channels experiencing a 33% increase in H1 FY24. Additionally, it asserted that quick commerce has become a robust channel, witnessing a remarkable over 100% year-on-year (YoY) growth.
This was the first time the company submitted its quarterly financial statements since it went public earlier this month.
The D2C unicorn had a subdued start on the Indian stock exchanges. Although it began trading at an almost 2% premium on the NSE, the shares opened flat at INR 324 on the BSE. The presence of a loss-making book significantly contributed to the negative impact on its public listing.
In the current funding environment, investors are placing a strong emphasis on the profitability of emerging technology companies, whether they are publicly traded or not. Shares of startups such as Zomato, Paytm, and PB Fintech have experienced a notable upswing this year, rebounding from the challenges faced in 2022, driven by positive developments in their financial performance.
Mamaearth’s shares were on an upward trajectory at the start of the week but experienced a decline in yesterday’s trading. As of now, the stock is trading more than 30% above its initial listing price.
