Honasa Consumer Ltd. IPO Review - Issue Date, Price, GMP, Subscription, Allotment, Lot Size, and Details

About Honasa Consumer Ltd. Limited

The company is the largest digital-first beauty and personal care (“BPC”) company in India in terms of revenue. It worked with the primary objective of developing products that address beauty and personal care problems faced by consumers.

The company has a portfolio of brands. The flagship brand, Mamaearth (Launched in 2016), is built to service a core customer need for safe-to-use, natural products, and focuses on developing toxin-free beauty products made with natural ingredients.

Brand Portfolio:

  1. Mamaearth
  2. The Derma Co.
  3. Aqualogica
  4. Ayuga
  5. BBlunt
  6. Dr. Sheth’s

 As of June 30, 2023, portfolio of brands with differentiated value propositions includes products in the baby care, face care, body care, hair care, color cosmetics and fragrances segments.

The BPC products market in India is undergoing a fundamental re-industrialization owing to the convergence of technology, demographic dividend, and growing consumer aspirations. The market for BPC products in India is expected to grow from $20 billion in 2022 to app. $33 billion in 2027 at a CAGR of app. 11%, which is among the highest within retail categories and other retail categories.

India’s per capita spend on BPC products is currently one of the lowest in comparison to some of the other developing countries and is at the cusp of growth as GDP per capita has surpassed $2,000, which is a critical inflection point as observed in other developing economies. There are several consumer behavior changes that are shaping the Indian BPC market. With increasing incomes and awareness, consumers are increasingly looking for masstige brands.

BPC is one of those categories that lends itself well to digital penetration. The online BPC market, which is currently sized as US$3 billion, is expected to grow at 29% annually to be around US$11 billion by 2027, translating to an online penetration of 34%.

Risk Analysis.

  1. Rapidly changing consumer preferences and spending patterns, changing beauty and personal care trends. This creates a lot of competition in the market. The market share of the company as of CY22 is 1.5% of the total BPC market. This makes the company offer discounts to the consumers.
  2. The top 10 products hold approximately 30% of the total Revenue. Similarly, Mamaearth holds approximately 80% - 90% of sales. Talking about expenses, Advertising holds 40% of revenue, whereas Cost of goods sold accounts for approximately 30%.
  3. The company relies on relationships with certain marketplaces and web traffic drivers for sales through our online channel.
  4. Unsuccessful launch of new products can hamper the brand image of the company.
  5. The company does not manufacture products and relies entirely on third-party manufacturers for the manufacturing. The top three manufacturers contributed 70-80% of the total value of purchase of traded goods.
  6. The company is dependent on several third-party service providers to sell or distribute products to consumers, and on third party technology providers for certain aspects of operations.
  7. The company do not hold any patents over product formulae and have not made any applications in this respect.
  8. Locations of EBOs and Saloons can lead to cost or can help in increasing the revenue depending on the management’s decision.
  9. Warehousing services are done on land which is on Lease.
  10. The company requires certain approvals and licenses in the ordinary course of business.

Services

The Process of Filing the Income Tax Return Online in India

1. Aadhaar and PAN Card of the taxpayer and the company

2. Bank Statements of the taxpayer/company/firm

3.Form 26AS: It is a summary of all the taxes that have been deducted from your income, such as TDS (Tax Deducted at Source).

4. Form 16: It is issued by your employer, which gives the details about the total salary + TDS deducted from it.

5. Investment and financial documents: If you have invested in shares, mutual funds, or fixed deposits, dividend statements, capital gains reports (if you have sold any assets), and interest certificates need to be attached.

6. Proof of other income: Other than your salary, if you have earned from different sources, such as from freelance work, rental income, or interest, you need to attach the documents, such as bonus receipts, interest certificates, rental agreements, and any freelance payment statements, to prove the same.

7. Deductions and tax-saving investments: To claim deductions under sections 80C - for investments in PPF, ELSS, etc., 80D - for insurance premiums, or 80G for the charitable donations, you need to attach the documents to prove the same.

8. Form 10E (If Applicable): If you have received salary arrears or any special bonuses, then you need to attach the Form 10E - it is used to claim tax relief for those payments under section 89(1) of the Income Tax Act, 1961.

9. TDS Certificates: If you have earned income from sources other than your salary, such as rent, interest, or professional fees, then your TDS might have TDS deducted. In this case, you need to attach the TDS certificates from those sources to show that tax has been deducted and deposited with the government.

10. Details of Foreign Income (If Applicable): If you have earned from abroad or own foreign assets, you need to disclose all the information in your ITR. Documents such as foreign bank statements, income certificates, or details of foreign investment are necessary to report this income correctly.

Services

The Process of Filing the Income Tax Return Online in India

1. Aadhaar and PAN Card of the taxpayer and the company

2. Bank Statements of the taxpayer/company/firm

3.Form 26AS: It is a summary of all the taxes that have been deducted from your income, such as TDS (Tax Deducted at Source).

4. Form 16: It is issued by your employer, which gives the details about the total salary + TDS deducted from it.

5. Investment and financial documents: If you have invested in shares, mutual funds, or fixed deposits, dividend statements, capital gains reports (if you have sold any assets), and interest certificates need to be attached.

6. Proof of other income: Other than your salary, if you have earned from different sources, such as from freelance work, rental income, or interest, you need to attach the documents, such as bonus receipts, interest certificates, rental agreements, and any freelance payment statements, to prove the same.

7. Deductions and tax-saving investments: To claim deductions under sections 80C - for investments in PPF, ELSS, etc., 80D - for insurance premiums, or 80G for the charitable donations, you need to attach the documents to prove the same.

8. Form 10E (If Applicable): If you have received salary arrears or any special bonuses, then you need to attach the Form 10E - it is used to claim tax relief for those payments under section 89(1) of the Income Tax Act, 1961.

9. TDS Certificates: If you have earned income from sources other than your salary, such as rent, interest, or professional fees, then your TDS might have TDS deducted. In this case, you need to attach the TDS certificates from those sources to show that tax has been deducted and deposited with the government.

10. Details of Foreign Income (If Applicable): If you have earned from abroad or own foreign assets, you need to disclose all the information in your ITR. Documents such as foreign bank statements, income certificates, or details of foreign investment are necessary to report this income correctly.

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