According to people aware of the matter, Honasa has assigned certain markets as priority geographies into which it is planning a deeper push for Mamaearth by appointing channel partners. These markets include Bangladesh, Malaysia, Vietnam and Thailand.
The company is already present in some overseas markets such as the UAE, Singapore, Nepal, Malaysia, Maldives and Mauritius, where it operates either through modern trade and ecommerce marketplaces, and even its own dedicated brand website in some cases.
The overseas drive comes as the Fireside Ventures- and Peak XV Partners-backed company has been engaging with investors to stitch up a pre-IPO funding of $120-150 million.
Also read | Mamaearth parent receives Sebi nod for IPO
In its draft red herring prospectus, which was released in December last year, Honasa Consumer had said that while India will continue to be its primary focus market in the medium term, it intends to “opportunistically” expand its presence in markets such as the UAE, Nepal and Bangladesh, both organically and through strategic acquisitions.
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The fresh push on overseas markets comes in the backdrop of a top-deck change at Honasa Consumer with its senior vice president for offline and international businesses Ashish Mishra moving on in September to join rival D2C personal care brand Clensta as cofounder and chief business officer. Following Mishra’s departure, the company announced the appointment of Nishchay Bahl, former chief business officer at The Good Glamm Group, as its senior vice president for offline sales.
Also read | Mamaearth parent Honasa Consumer appoints Nishchay Bahl to lead offline business
“The company begins by operating through distributors and channel partners, and identifies priority markets based on the response to its products and demand projections by the partners. Once there is enough buzz around the brand, it doubles down,” the person said.
“The UAE is key to the company’s expansion strategy in West Asia and North Africa…having a solid relationship with a distributor in a place like Dubai ensures the brand is present on online marketplaces and on shelves in modern trade stores across the region,” they said.
Honasa Consumer did not respond to queries sent by email.
In addition to Mamaearth, Honasa Consumer also operates brands such as The Derma Co and BBlunt. On September 20, the company had said that the annual revenue rate of its active ingredients backed skincare brand The Derma Co crossed the Rs 350 crore mark during the June-quarter of this year, making it the second brand in Honasa Consumer’s portfolio to do so after Mamaearth.
On August 3, Honasa Consumer received an approval from the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO), and the company’s top management is currently doing roadshows, meeting investors to gauge the interest in its public offering.
According to its draft red herring prospectus filed with the markets regulator in December 2022, the company plans to issue fresh shares worth Rs 400 crore, in addition to an offer-for-sale (OFS) component for 46.82 million shares. The OFS will see some stakeholders sell their stakes partially.
These include founders Varun and Ghazal Alagh as well as investors such as Sofina, Fireside Ventures, Evolvence India, Stellaris and angel investors such as Snapdeal founders Kunal Bahl and Rohit Bansal, Rishabh Mariwala of FMCG giant Marico and actor Shilpa Shetty Kundra.
The company was last valued at $1.2 billion when it raised $52 million in January 2022 in a round led by Peak XV Partners (then Sequoia Capital India). The venture capital firm is not selling its shares in the proposed IPO.
As per the offer document, Honasa Consumer reported revenue from operations of Rs 722.73 crore during April-September 2022 with a profit of Rs 3.67 crore. This compares to Rs 943.46 crore in operational revenue for the year ended March 31, 2022, on a net profit of Rs 14.43 crore.
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