Honasa Consumer (HONASA) Q1 25/26 earnings summary

Executive summary

• Achieved record quarterly revenue of INR 595 Cr (Rs 5,952.54 million consolidated), up 7.5% YOY and 11.6% sequentially, with highest ever profit and strong volume-led growth.

• Focus categories contributed ~80% of revenue, growing double digits, with strong momentum in e-commerce and modern trade channels.

• Young brands portfolio grew 20%+, now contributing over 50% of revenue, though growth moderated due to base effect and sunscreen softness.

• Continued innovation with new launches in hair care, moisturizers, and sunscreens, and expanded offline distribution to 240,113 FMCG retail outlets, up 20% YOY.

• Board approved unaudited standalone and consolidated financial results for Q1 FY26, reflecting restated comparatives due to subsidiary amalgamation.

Financial highlights

• Revenue from operations: INR 595 Cr (consolidated Rs 5,952.54 million), up 7.4% YOY and 11.7% QoQ; PAT: INR 41 Cr (consolidated Rs 413.25 million), margin at 6.9%.

• Gross margin improved by 48 bps YOY to 71.2%; EBITDA margin at 7.7%, up 264 bps sequentially.

• Negative working capital cycle maintained at (11) days, supporting cash generation.

• A&P expenses at 35% of sales, expected to settle at 27-28% for mature brands.

• Basic EPS (consolidated) for Q1 FY26 was Rs 1.27, up from Rs 1.24 year-over-year.

Outlook and guidance

• Double-digit value growth and 7% EBITDA margin expected for the remainder of FY26.

• Mid-teen EBITDA margins targeted for top brands in 4-5 years, with ongoing annual margin improvement.

• Sun care and face serums expected to become INR 5,000 Cr+ categories by 2028; color cosmetics projected to reach INR 17,300 Cr.

• No material financial impact is expected from ongoing legal disputes as of the reporting date.

• Continued focus on innovation, category expansion, and infrastructure improvement to drive growth.