Mamaearth’s Journey Post-IPO


Mamaearth IPO to debut on Tuesday: Stock may list at 8-10% premium over  issue price

Mamaearth is the primary brand under Honasa Consumer Ltd, alongside brands like The Derma Co, Aqualogica, Ayuga, BBlunt, and Dr Sheth’s. Established in 2016 by the duo Varun Alagh and Ghazal Alagh, the company’s primary goal is to establish a secure and health-conscious environment for mothers and infants. The company has grown very quickly since it was founded, diversifying its product range to include hair care, skin care, baby care, men’s grooming, oral care, and wellness categories.

Honasa Consumer Ltd, Mamaearth’s parent company, was a fast-growing brand with impressive valuations. Investors were looking forward to investing in Mamaearth IPO. Strategic portfolio management is essential to picking promising stocks, and the analysis of Mamaearth IPO will help to understand if it was a good investment decision.

Mamaearth was successful in drawing confidence from its recent profitability. The company achieved profitability in FY22 and recorded net earnings of Rs 14 crore, a significant turnaround from losses that amounted to Rs 1,332 crore in FY21 and Rs 428 crore in FY20. Moreover, during the initial six months of FY23, the company had a net profit of Rs 4 crore.

Mamaearth brand did notably well and lived up to the hype. It made profits that rose over 3 points from 66.5 percent in FY20 to 69.96 percent in FY22.

Source: DRHP

Source: DRHP

Mamaearth Post IPO situation

Honasa Consumer’s IPO received substantial interest on the closing day of the bidding process on Nov 2nd, 2023, and was over-subscribed. The bidding for Mamaearth IPO began on October 31, 2023, and ended on November 2, 2023. The final allotment for the IPO was closed on November 6, 2023. The IPO price band was set at  ₹308 to  ₹324 per share. It was successful in raising  ₹765.20 crore from its anchor investors.


  • Mamaearth became the most searched Beauty and Personal Care Brand between January 2020 and November 2022.
  • Sales from new product variations contributed more to their earnings, growing from 39.75% in FY 21 to 42.17% in FY 22.
  • Mamaearth showcased strong skills in building its brand, excelling in its field, and focused on customer-driven product innovation.
  • The company as a brand focuses on the Beauty and Personal Care category.


  • Couldn’t adapt to changing consumer preferences, which affected product demand and hurt business performance.
  • Found it challenging to uphold the brand reputation, negatively impacting the business.
  • Spent heavily on marketing, around 40% of revenue.
  • Relied heavily on a few products; the top 10 products contributed 30% of revenue, and the top 2 contributed 13%.
  • It expanded rapidly into offline channels.
  • Faced tough competition from new and existing brands in similar categories.

Mamaearth’s financial analysis

Mamaearth’s strategic focus on constructing purpose-driven brands contributed to establishing trust and resonance with its consumers, facilitating substantial business growth. As per a RedSeer report, Mamaearth demonstrated remarkable revenue growth from operations and achieved an outstanding CAGR of 193.15% compared to the industry’s average of 13% over the same period.

Among the beauty and personal care (BPC) companies, Mamaearth stood out with the highest direct-to-consumer (DTC) revenue, accounting for 52.37% of its total revenue during the six months ending September 30th, 2022. Mamaearth secured second position among digital-first BPC companies in India in FY 2021, boasting 71.15% gross profit margins. The company attributed its success to a business model driven by customer-centricity, agility, technology, and differentiation.

In FY 2021, Mamaearth stood alongside only one other digital-first BPC company in India with a positive adjusted EBITDA margin of 6.82%. Moreover, its adjusted EBITDA reflected consistent growth across preceding quarters, indicating an upward trajectory in financial performance.

Mamaearth IPO analysis

Mamaearth IPO received a positive reception from investors on the final day of the bidding phase. Initially, it was slow in the first two days, but the issue garnered a complete subscription by the third day. It was primarily fueled by robust institutional interest.

The overall subscription rate stood at 7.61 times, notably led by the Qualified Institutional Buyer (QIB) category, which recorded an impressive subscription rate of 11.5 times. Considering this industry’s potential growth, the Mamaearth IPO might continue to capture investor interest.  In FY23, Honasa Consumer became the foremost digital-first company in India’s beauty and personal care (BPC) sector, notably leading in revenue. Mamearth, the flagship brand, stood out by generating the highest revenue.

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