Honasa Consumer Shares Gain 5% as Brokerages Raise Targets After Q2 Earnings

Honasa’s Earnings Put Growth and Margin Delivery in Focus

Brokerage upgrades followed a strong quarter, but the next test is whether Honasa can sustain its growth and profitability trajectory.

Shares of Honasa Consumer, the parent of Mamaearth, rose as much as 5.07% to ₹493.90 on the NSE, compared with the previous close of ₹470.05. At 9.40 am, the stock was up 2.51% at ₹482.30. About 2.5 million shares had changed hands across the BSE and NSE combined by that time. The advance came in an otherwise lacklustre market and extended the stock’s gains to a second session.

The initial response to the results had been weaker: Honasa shares closed 3.2% lower on Friday after the company announced its quarterly performance during market hours. The subsequent rise suggests investors were also assessing the numbers and analysts’ revised forecasts. The share was reported to be up 70% so far in 2026 and 76% over one year, making expectations around future performance an important part of the market’s assessment.

A strong quarter brought growth and margins together

Revenue rose about 36% year on year to ₹731 crore in Q2 FY27. EBITDA nearly doubled to ₹93 crore, while profit after tax increased 87% to ₹74 crore. The results point to more than sales growth: profitability improved as the company benefited from operating leverage, a better channel mix and advertising and promotion efficiency in its core brands.

EBITDA margin expanded 3.8 percentage points year on year to 12.7%, even as gross margin contracted by 55 basis points amid high input cost inflation. Honasa said its focus categories grew more than 40%, while Mamaearth maintained high-teens growth and delivered mid-teens EBITDA. That combination gives investors evidence of momentum across the portfolio, while the gross-margin decline remains a reminder that cost pressures have not disappeared.

Analysts lifted forecasts, with different target prices

Jefferies raised its earnings estimates by 10% to 16% and set a target price of ₹700, citing broad-based brand and channel momentum and a sharp margin improvement. Its forecasts assume revenue and EBITDA compound annual growth of 20% and 33%, respectively, over FY26-29. Those are analyst projections, not company guarantees, and depend on Honasa sustaining growth while converting it into operating profit.

Emkay Global raised its FY27-29 earnings estimates by 5% to 9%, pointing to stronger-than-expected performance from Mamaearth and The Derma Co and higher margin assumptions. It retained a Buy rating and increased its target price by 4.5% to ₹575, based on 50 times its September 2028 earnings-per-share estimate. The gap between the two targets underscores that brokerage valuations rely on different assumptions and should not be treated as certain outcomes.

Margin guidance is the next execution test

The company expects to maintain its current margin trajectory of 12.5% in the second half of the fiscal year. It also retained its ambition of expanding margins by 100 to 150 basis points annually over five years, reaching 15% in FY30. Delivering that path would require growth, cost management and continued operating efficiencies to work together; a single strong quarter does not establish that the targets are assured.

Innovation and renovation remain priorities, according to the company. For investors, the key question is whether new offerings and growth across brands can support sales without undermining margins. The earnings response has improved sentiment, but the elevated forecasts make upcoming evidence of sustained growth and profitability especially relevant.

Key Highlights

• Honasa shares gained as much as 5.07% after brokerages revised estimates and target prices.
• Q2 FY27 revenue rose about 36% to ₹731 crore, while EBITDA nearly doubled to ₹93 crore.
• Profit after tax increased 87% to ₹74 crore; EBITDA margin expanded to 12.7%.
• Jefferies set a ₹700 target; Emkay raised its target to ₹575 and retained a Buy rating.
• Honasa expects a 12.5% margin trajectory in the second half and retains its 15% FY30 margin ambition.

Investor Note: The quarter offers evidence of improving growth and profitability, but brokerage targets depend on forecasts that may not be achieved. Investors may want to track sales momentum, input-cost effects and progress against margin guidance rather than relying on target prices alone.