Honasa Consumer Hits Turbulence After IPO

Honasa Consumer Hits Turbulence After IPO

Honasa Consumer Hits Turbulence After IPO

Honasa Consumer, the parent company of popular brand Mamaearth, saw its shares drop by nearly 5% on Thursday, continuing the decline after a tepid market debut the day before. The downward movement was marked by a significant intra-day fall, with shares touching a record low of ₹307, thereby slipping 5.2% below its Initial Public Offering (IPO) price of ₹324.

Stock Slips Below Issue Price

The company’s stock, which had breached its issue price on the first day itself, closing slightly below at ₹322.50, witnessed another dip in value. Despite opening at ₹330 per share, a modest 1.85% premium over the issue price, the stock failed to maintain the momentum, aligning with the broader trend of investors locking in gains post-listing.

Market Experts Weigh In

Market analysts like Shivani Nyati from Swastika Investmart have pointed out that while Honasa Consumer has established a significant presence in the Indian beauty and personal care market with a diverse portfolio, it faces financial and operational headwinds. Following a reasonable subscription level during its IPO, which was open from October 31 to November 2, experts are now advising investors to book profits and exit their positions.

IPO Snapshot and Future Outlook

The Honasa Consumer IPO, with a price band of ₹308 to ₹324, managed to raise ₹1,701 crore, combining a fresh issue and an offer-for-sale. The public offering was well-received, with the retail investor segment subscribed 1.35 times, non-institutional investors 4.02 times, qualified institutional buyers 11.50 times, and the employee quota 4.87 times. Additionally, the company garnered ₹765.20 crore from anchor investors, including seven notable mutual funds, just ahead of the IPO. As the market continues to evaluate Honasa’s financials and growth trajectory, the stock’s journey post-IPO will be closely watched by investors and industry observers alike.

Disclaimer: The opinions and suggestions provided in this article are those of individual analysts and do not reflect the viewpoints of VoM News. We encourage investors to consult with certified experts before making any investment choices.

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