Honasa Consumer (HONASA) Q2 25/26 earnings summary

Executive summary

• Achieved 22.5% year-over-year revenue growth in Q2 FY26, with gross profit at an all-time high of 71.9% and EBITDA margin stable at 8.4% (INR 48 crore), resulting in PAT of INR 39 crore.

• Core/focus categories now contribute over 75% of revenue, up from 70% last year, with a target to reach 84-85% in the next 4-6 quarters.

• Mamaearth and The Derma Co brands led growth, with The Derma Co achieving INR 750 crore net sales ARR and becoming India's #1 sunscreen brand in 2024.

• Young brands portfolio delivered 20% YoY growth, with innovation and new launches driving performance.

• Board approved acquisition of 25% in Couch Commerce Private Limited (Fang Oral Care) for up to INR 10 Crores.

Financial highlights

• Q2 FY26 consolidated revenue from operations: Rs 5,380.63 million, up from Rs 4,618.22 million in Q2 FY25, with net profit at Rs 392.27 million compared to a loss of Rs 185.75 million in Q2 FY25.

• Q2 FY26 EBITDA: INR 48 Cr (8.9% margin), PAT: INR 39 Cr (7.3% margin); H1 FY26 EBITDA: INR 93 Cr (8.2% margin), PAT: INR 81 Cr (7.1% margin).

• Gross profit margin improved to 71.9% in Q2 FY26; H1 EBITDA margin at about 8%.

• Maintained negative working capital position, supporting cash flow.

• Flipkart's change in settlement process led to a INR 28 crore revenue recognition impact, with no effect on absolute profitability.

Outlook and guidance

• Expect high single-digit growth in the next quarter, aiming for double-digit growth by Q4 and into next year.

• Margin guidance maintained at 7%+ for the coming quarters and next year.

• Premiumization and innovation in skin care, hair care, and oral beauty expected to drive future growth.

• Focus remains on core categories and hero SKUs, with continued investment in media mix optimization.

• Expansion into oral care through acquisition of Couch Commerce Private Limited to tap into fast-growing categories.