Honasa Consumer block deal: Mamaearth employees may sell Rs 150 crore worth ESOPs this week, says report

Shares of Honasa Consumer Ltd (Mamaearth) would be in focus on Tuesday morning after a media report suggested that employees of the company may sell ESOP (employee stock ownership plan) pool of 31 lakh shares this week. The ESOPs would be sold for about Rs 150 crore and at 5-7 per cent discount to the prevailing market price, CNBC-Awaaz reported.

Honasa Consumer shares soared 12.45 per cent to settle at Rs 475.10 on Friday. As per Nuvama Institutional Equities, a total of five block deals (17,78,000 shares) were recorded on Honasa Consumer counter worth Rs 72 crore last week at an average rate of Rs 403. The scrip climbed 43 per cent during the week.

The scrip was in news last week after the parent of Mamaearth clocked a 94 per cent year-on-year rise in its profit at Rs 29 crore in the September quarter. The largest digital-first beauty and personal care company said its revenue for the quarter was up 21 per cent YoY at Rs 496 crore and that like-for-like growth of continuing business stood at 24 per cent. The sales growth was lead by 27 per cent YoY jump in volumes, Honasa Consumer said in a BSE filing.

Following this, Jefferies upgraded its earnings per share estimate by 5-6 per cent for Honasa Consumer on strong top line and margin and as a result upped its target price for the stock to Rs 530 from Rs 520 earlier.

"While there was a growth deceleration from June quarter, the Honasa management attributed this to ERP changeover and hence, H1 growth of over 35 per cent reflects the true picture. New brands are scaling up well, with Dr Sheth now the fourth brand to cross Rs 150 crore ARR," Jefferies said in a note.

Mamaearth stock is up 47 per cent from its issue price of Rs 324. The stock got listed at bouses on November 7.

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