
Shares of Honasa Consumer Ltd fell over 6 per cent to hit sub-Rs 500 level in Thursday's trade amid high turnover. There were reports that a few of existing shareholders were looking to sell a part of their stakes in the Mamaearth parent at Rs 480 apiece. This floor price was at 8 per cent discount to Honasa's Wednesday closing price of Rs 522. The scrip had settled 3.59 per cent lower in the preceding session.
On Thursday, the stock fell 6.13 per cent to hit a low of Rs 490 on NSE. The stock recorded a turnover of Rs 2,191.67 crore on NSE within first half-an-hour of trading. A total of 4.42 crore shares changed hands on the counter.
As per a media report, a total of 8.1 per cent of Honasa Consumer's equity was expected to change hands in large block deals today, valuing at Rs 1,261 crore.
Sellers, as per a source-based CNBC TV18 report, were Redwood Trust, Fireside Ventures, Sequoia Capital, Peak XV Partners, Sofina Ventures Stellaris Ventures. The report did not mention about the stake that each of these Honasa Consumer investors were selling. There would be a lock-in period of 60 days on any further sale of the shares following the transaction, the media report suggested. Business Today could not independently verify the report.
Kotak Securities and Jefferies India are said to be the brokers managing the whole process.
Emkay Global earlier this month said it was positive on Honasa, given execution thrust by the management with a view to addressing offline channel needs in FY25.
"Corrective actions in offline trade inventory are aimed at restoring channel hygiene and enhancing margin by 100-150bps from FY26E (with reduced provisioning), in our view. FY26E onward, we see margin logging in double digits, further aided by logistic cost optimization (with improvement in offline sales mix) and operating leverage benefits," it said.
The brokerage retained its expectations of 21 per cent CAGR growth in revenue and 44 per cent CAGR in earnings, over FY24-27E.
"We raise our target EV/sales to 6.5 times from 6 times, which is at 25 epr cent discount to market-cap weighted sector-average EV/sales of 8.5x. As we roll over from Jun-26E to Sep-26E sales, our target price gets hoisted to Rs 600 per share from Rs 525. Implied target Sep-26E EV/Ebitda stands at 54x and P/E at 68x, resp; maintain BUY," it said on September 2.