Honasa Consumer Ltd, the parent company of MamaEarth, experienced significant financial growth in FY24, reporting a revenue of Rs 1,920 crore, nearing the Rs 2,000 crore mark, and a profit after tax (PAT) of Rs 110 crore. This marked a notable turnaround from the previous fiscal year, where the company faced over Rs 100 crore in losses.
The revenue from operations saw a substantial increase from Rs 1,492 crore in FY23 to Rs 1,920 crore in FY24, as per the consolidated financial statements from the Bombay Stock Exchange (BSE). However, there was a slight sequential decrease in revenue, from Rs 488 crore in Q3 FY24 to Rs 471 crore in Q4 FY24.
Honasa primarily generates revenue from the sale of beauty, personal care, and related products, including skin, hair, and baby care items. Additionally, it earned Rs 48 crore from the interest and gains of financial assets, resulting in a total revenue of Rs 1,970 crore in FY24.
While the marketing and advertisement costs for the D2C brand are expected to be significant, the complete breakdown of expenses was not disclosed. Procurement of materials accounted for 31.8% of the overall expenditure, with other costs including employee benefits, finance, depreciation, legal fees, and overheads, totaling Rs 1,822 crore in FY24, up from Rs 1,501 crore in FY23.
The company's focus on maintaining reasonable costs and achieving a decent scale led to a profit of Rs 110 crore in FY24, compared to a loss of Rs 151 crore in FY23. Key financial metrics such as return on capital employed (ROCE) and earnings before interest, taxes, depreciation, and amortization (EBITDA) margins also improved to 13% and 9.5%, respectively. On a unit level, the company spent Rs 0.95 to earn a rupee in FY24.
It's worth noting that the significant loss in FY23 was attributed to the write-off of a Rs 154 crore investment in Just4kids (Momspresso) aimed at expanding content and influencer management capabilities.
However, Honasa faced legal challenges in the UAE related to distribution agreements with RSM General Trading LLC, with the court ordering the company to pay damages and interest. Despite this setback, Honasa is in the process of appealing the decision.
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