Honasa Consumer shares jump 14% to fresh record high; here’s what driving the rally?

Shares of Honasa Consumer, the parent company of D2C brands like Mamaearth, The Derma Co, and BBlunt, soared over 14 percent, reaching a record high of ₹534.90 on the NSE.

The stock surged after the company received approval from the National Company Law Tribunal in Chandigarh for the amalgamation scheme involving Just4Kids Services Private Limited, Fusion Cosmeceutics Private Limited, and Honasa Consumer.

"Intimation of receipt of the order of the Hon’ble National Company Law Tribunal, Chandigarh Bench in relation to the Scheme of Amalgamation between Just4Kids Services Private Limited, Fusion Cosmeceutics Private Limited, and with Honasa Consumer Limited," the company said in an exchange filing.

Founded in 2010, Just4Kids Services offers a platform to access information on playschools, schools, hobby and sports classes, events, summer camps, and workshops for children in Delhi, Gurgaon, Noida, Faridabad, and Ghaziabad.

Fusion Cosmeceutics is mainly involved in creating and selling skincare products. On April 19, Honasa Consumer's board approved a merger plan with this company.

Additionally, Honasa Consumer introduced its Kerala Thaali Hair Care Range last Friday. The company described this range as a tribute to Kerala's cultural heritage, crafted to deliver a comprehensive hair care experience with remarkable strength and shine.

As of 11:58 am, Honasa Consumer’s shares were trading 13 percent higher at ₹533.10 on the National Stock Exchange (NSE). The stock has increased by 22 percent over the past six months, surpassing Nifty's 13 percent return during the same period. Since its NSE debut at ₹330 on November 7 last year, the stock has surged by 63 percent.

Honasa Consumer Q1 results

For the quarter ending in June, Honasa Consumer reported a net profit of ₹40.2 crore, marking a 62.7 percent year-on-year increase. The company’s consolidated revenue from operations also grew by 19 percent year-on-year to ₹554.1 crore.

Honasa reported a 20.3 per cent increase in product business growth, with an underlying volume growth (UVG) of 25.2 per cent.

The EBITDA margin improved by 201 basis points year-over-year to 8.3 per cent, leading to an EBITDA of ₹46 crore.

The company's shares closed at ₹507.40, marking an increase of 8.14 per cent from the previous closing price.