This smallcap stock zooms 7% after co. turns profitable in Q4FY24; should you buy, sell or hold it?

Shares of Honasa Consumer, the parent company of the famous Mamaearth brand, started Friday’s session on a strong note as the personal care concern turned profitable in the March quarter.

In the early morning deals after logging 7 per cent gains over the previous close, shares of the company traded higher by over 4 per cent or Rs 18.4 at Rs 436.5 per share on the BSE.

In the final quarter of fiscal year 2024, the company delivered the highest-ever quarterly PAT of Rs 30 crore as against loss of Rs 160 crore in the same period last year. In the base year, the company reported an exceptional loss to the tune of Rs 155 crore. Consolidated revenue during Q4FY24 came in at Rs 471 crore, up 21.5 per cent on-year. Further, sales at the company grew by 21.5 per cent on-year, while consolidated EBITDA improved by 780 bps to Rs 33 crore.

The business continues to be capital efficient, with a negative working capital cycle of minus 13 days, said the company in its release.

Brokerages view on Honasa Consumer post its Q4 results

Global brokerages seem largely split on the outlook of the stock. Jefferies has continued with its ‘buy’ stance on the counter with a target of Rs 590, implying possible upside potential of over 41 per cent. Nonetheless, JP Morgan maintains an ‘overweight’ view and has raised the target to Rs 400 from the earlier Rs 390, suggesting a possible downside of 4 per cent.

Honasa Consumer share price performance 

Since its listing in November last year at a price of Rs 330 per share on the NSE, the stock has zoomed as much as 27 per cent.