November 30, 2023
Mamaearth makes public debut, youngest Indian unicorn to list | TechCrunch

Shares of Honasa Consumer, the parent firm of direct-to-commerce beauty and personal care Mamaearth, jumped slightly in a key public listing watched by many Indian startups as they evaluate their own initial public offerings.

Mamaearth, a seven-year-old company, was trading at 331.45 Indian rupees ($3.98) per share on NSE, above its 330 Indian rupees listing price on the local exchange.

The startup — valued at $1.2 billion in early 2022 — counts Peak XV Partners, Fireside Ventures, Stellaris Venture Partners, and Sofina among its backers. It raised about $92 million in an anchor round last week from over three dozen asset managers including Abu Dhabi Investment Authority, Fidelity, Norges Bank, Invesco and Goldman Sachs. (Peak XV has made a 10x-plus return on its investment in Mamaearth, according to debut listing price.)

The firm, founded by husband-wife entrepreneurs Varun Alagh and Ghazal Alagh, operates a portfolio of six distinct brands. Its eponymous main brand, Mamaearth, accounts for approximately 80% of its revenue in the fiscal year 2023. Honasa also operates The Derma Co, Aqualogica, and Ayuga, alongside those acquired, namely BBlunt and Dr Sheth’s.

Mamaearth’s business operations hinge on third-party manufacturing, with the company holding no manufacturing IP of its own. Its products reach consumers via an omni-channel network, with online sales, including direct-to-consumer and e-commerce, delivering 59% of total revenue across nearly 18,600 pin codes. Offline channels, contributing 36% of sales, span over 154,000 retail points, incorporating a mix of traditional and modern trade outlets, exclusive stores, and BBlunt salons.

In the fiscal year 2023, Mamaearth reported revenues of approximately $170 million, with the online channel yielding around 56% of this figure. The company maintains a gross margin of 70%, alongside an adjusted EBITDA margin of 3%. Offline sales now represent 36% of the total revenue, marking an increase for the fiscal period.

About a dozen other Indian startups are keenly monitoring market conditions as they assess the timing for their initial public offerings. Mamaearth earlier sought a valuation of $3 billion at its public debut, but later cut short the target as market conditions worsened.

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