Honasa Consumer, the parent of beauty and personal care brand Mamaearth, said on Thursday it expects to post a revenue growth in the late twenties in the March quarter, driven by strong momentum in its focus categories and offline sales.  

In the December quarter, Honasa nearly doubled its net profit to Rs 50 crore, while revenue grew 16% year-on-year at Rs 602 crore. In Q4, the company’s flagship brand, Mamaearth, is expected to grow in the teens, while the younger brands – The Derma Co, Aqualogica, Dr Sheth’s, BBlunt, and its colour cosmetics line Staze 9to9 – are expected to deliver growth in the mid-twenties.

In the last few quarters, the company had narrowed Mamaearth’s focus to five key categories — shampoo, face serum, suncare, moisturiser, and baby care — after previously operating across as many as 24 segments. 

However, reported revenue growth in the March quarter might be in the early twenties due to a change in settlement by Flipkart — where logistics and fulfillment costs are now adjusted in revenue reporting, the company said in a regulatory filing. In Q3, this had led to a hit of Rs 28 crore to the topline. 

As for the bottomline performance, the company expects to sustain its overall operating profit margin profile in Q4. PAT margin in the December quarter rose to 8.3% from 5% in the year-ago period. 

Honasa is witnessing a steady recovery in performance after grappling with distribution challenges in 2024 during its transition from a super stockist model to direct distributorship in its top 50 cities. 

Under the super-stockist model, companies rely on large regional wholesalers to supply products to sub-distributors and smaller retailers, while the direct distributor model involves working more closely with a wider network of city-level partners, giving companies greater control over its pricing and inventory.

The move, aimed at boosting offline sales as post-pandemic online demand began easing, is now bearing fruit. Over the past six quarters, the company has managed to steadily revive its financials from a loss of Rs 19 crore in the second quarter of FY25 to a profit of Rs 50 crore in Q3. 

In its Q4 business update, the company also noted that it is tracking the evolving geopolitical environment and will continue to undertake proactive measures to mitigate any potential impact on operations and cost structure.

Post the update, shares of the company rose about 6% on Thursday to Rs 331.2. The company’s March quarter earnings are expected in the later half of May.