Despite oversubscription, Honasa Consumer saw an uninspiring start on the bourses on November 7. Shares of Mamaearth's parent company started trading at Rs 330 on the NSE and Rs 324 on the BSE, against issue price of Rs 324.
Mamaearth’s IPO had sailed through, led by qualified institutional bidders (QIB) who bought 11.5 times while retail investors remained cautious, subscribing 1.4 times the allotted quota.
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The company reported a net loss of Rs 150.9 crore during the year ended March 2023, impacted by the impairment loss on goodwill and other intangible assets, against a profit of Rs 14.4 crore in the previous year.
The volume growth fell significantly to 68.23 percent in FY23 from 143.3 percent in FY22 and 298.42 percent in FY21. However, revenue from operations grew at a CAGR of 80.14 percent during FY21-FY23.
Also Read: Mamaearth IPO: An empty vessel making loud noise?
The parent firm of Mamaearth attracted interest from marquee names like Smallcap World Fund Inc, Fidelity Funds, Abu Dhabi Investment Authority, Government Pension Fund Global, Caisee De Depot ET Placement, FSSA India Suncontinent Fund, Carmignac Portfolio, Goldman Sachs, and Hornbill Orchid India Fund.
However, retail investors were not too excited by the IPO as the portion reserved for them saw relatively weaker interest. Much of the furore on social media has been around the company's exorbitant ad spends. The company spends 30-40 of its revenue on advertising and promotions.
Also Read: Deepinder Goyal gets Mamaearth IPO allotment, no-show from Ashneer Grover
Honasa Consumer claims to be the largest digital-first beauty and personal care company in India in terms of revenue from operations for the fiscal FY23. Its Mamaearth brand, which launched in 2016, has emerged as the fastest-growing BPC brand in India to reach an annual revenue of Rs 1,000 crore within six years.
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