Honasa shares soar 13% on Q1 beat, Jefferies predicts stock can rally up to Rs 400

Shares of Honasa Consumer, parent of beauty and personal care brand Mamaearth, soared 13% to Rs 301 on the BSE on Tuesday after announcing its Q1 results.

Global brokerage Jefferies maintained a ‘Buy’ rating with a target price of Rs 400, noting 7% YoY revenue growth in line with estimates. Gross margin contracted ~50 bps YoY, while A&P spending rose 3%. EBITDA margin slipped ~60 bps YoY to 7.7% (+2.6 ppt QoQ). EBITDA was flat YoY, but net profit saw slight growth, both exceeding expectations.