BENGALURU: Beauty and personal care company Honasa Consumer’s -- the parent company of brands such as Mamearth and The Derma Co -- transition has impacted its revenue and profits, thereby leading to a slowdown for Mamearth.
The company, which posted Rs 40 crore net profit in the first quarter of this fiscal year, has reported a consolidated loss of Rs 18.57 crore in the second quarter.
The company’s revenue from operations in the second quarter stood at Rs 461.82 crore, a 17% decline compared to the previous quarter. Varun Alagh, Chairman and CEO, Honasa Consumer Limited, during a call with analysts acknowledged how consumer behaviour and distribution are changing, especially in the Indian context.
He said the company’s outcomes have not gone in line with its expectations and inventory correction was higher than what they had imagined it would be.
Also, assumptions that they had made did not pan out as expected, which affected growth of Mamaearth. Mamaearth is growing slower than the company’s expectations and that they are making identified structural changes to bring it back to its growth trajectory in a few quarters.
Also, over the past few months, the company has been implementing Project Neev to optimise its distribution model. Some of the factors impacting growth of Mamaearth include distribution and supply chain transition as part of Project Neev, and that its investment allocation models have not evolved for offline-based brands.