Mamaearth makes public debut, youngest Indian unicorn to list


Shares of Honasa Consumer, the parent firm of direct-to-customer 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 that has seen a surge in the demand of its products after the pandemic, ended the debut trading day Tuesday at 337.50 Indian rupees ($4) per share, above its 324 Indian rupees ($3.89) listing price on the local exchange. The firm currently has a market cap of $1.3 billion.

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.)

“It is just over five years since the Mamaearth seed round was announced. And the company is listing today. That is incredible speed of growth (and time to listing for a consumer products / brand company)!” said Sajith Pai, a partner at Indian venture capital firm Blume. “When the round was announced the company was at about 15 crores runrate; post money was just under 100 crores (<7x rev to valuation multiple). Today rev = ₹1.5k crores and list price valuation = !7x still! Interesting – you would expect seed multiples to be higher than IPO multiples”

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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