Honasa Consumer Limited's Initial Public Offer to open on October 31, 2023, Turns Profitable in Q1-FY 2024

 

Mumbai: “Honasa Consumer Limited” (“HCL” or the “Company”), proposes to open on Tuesday, October 31, 2023, an initial public offer of equity shares of the face value of ₹10 each (“equity shares”) of ‘Honasa Consumer Limited’ (“Company” or “Issuer”).

The company has a turnaround in Q1-FY 2024 reporting a net profit of Rs. 24.71 crore against a net loss of Rs. 11. 52 crore in Q1-FY 2023 and a net loss of Rs. 151 crores in FY 2023.

The gross profit margin of 17.03 % in Q1-FY 2024 allows a high-profit poll to leverage as cost efficiency set in. The company is on the cusp of an increase in profitability trajectory with business model efficiency and operating leverage setting in.

The total offer size comprises of fresh issue aggregating up to ₹ 365 crore Equity Shares and an Offer for Sale (OFS) of up to 41,248,162 Equity Shares by Selling Shareholders. (“The Total Offer Size”). Those offering shares in the OFS include promoters and founders -- Varun Alagh and Ghazal Alagh -- and investors like Fireside Ventures Fund, Sofina, Stellaris, Kunal Bahl, Rohit Kumar Bansal, Rishabh Harsh Mariwala and Bollywood actor Shilpa Shetty Kundra.

The Offer will close on Thursday, November 2, 2023.

The Price Band of the Offer has been fixed at ₹ 308 to ₹ 324 per Equity Share. Bids can be made for a minimum of 46 Equity Shares and in multiples of 46 Equity Shares thereafter. A discount of ₹ 30 per equity share is being offered to eligible employees bidding in the employee reservation portion.

The Company, as part of the Objects of the Offer, proposes to utilize the Net Proceeds raised through the Fresh Issue towards (i) Advertisement expenses towards enhancing the awareness and visibility of brands, (ii) Capital expenditure to be incurred by Company for setting up new EBOs, (iii) Investment in its Subsidiary, Bhabani Blunt Hairdressing Private Limited (“BBlunt”) for setting up new salons; and (iv) General corporate purposes and unidentified inorganic acquisition. (Collectively, the “Objects”).

Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited, JM Financial Limited, and J.P. Morgan India Private Limited are the Book Running Lead Managers to the offer.