Shares of Honasa Consumer surged more than 10 percent on Friday after the beauty and personal care company delivered a strong March quarter performance, supported by robust profit growth, expanding margins, and improving traction across its flagship and emerging brands.

The company, best known for brands such as Mamaearth and The Derma Co, reported consolidated net profit of Rs 69.43 crore for Q4 FY26, more than doubling from Rs 24.97 crore recorded in the corresponding quarter last year. Revenue from operations rose 23.15 percent year-on-year to Rs 657.08 crore, reflecting stronger demand recovery and improved channel execution.

The earnings performance came at a critical stage for the company, which had spent the previous few quarters recalibrating its distribution strategy and attempting to restore growth momentum after operational disruptions linked to channel realignment. Investors appeared to interpret the latest numbers as evidence that the restructuring phase may now be stabilising.

The stock climbed as much as 10.4 percent intraday to Rs 398 on the NSE after the results announcement, with brokerages maintaining optimistic outlooks on both growth and profitability.

The company said Q4 FY26 marked its highest-ever quarterly revenue and EBITDA on a year-on-year basis, with EBITDA reaching Rs 77 crore. The sharp rise in profitability was driven by operating leverage, improved product mix, and better cost efficiencies across channels.

Brokerage firm Jefferies retained its ‘Buy’ rating with a target price of Rs 565, arguing that Honasa Consumer is now back on a stronger growth trajectory after navigating a difficult transition period. According to the brokerage, growth in Mamaearth returned to the mid-teens during the quarter, while younger brands continued to gain market share and support margin expansion.

CLSA also maintained an ‘Outperform’ rating with a target price of Rs 434. The brokerage highlighted that revenue growth of 23 percent was accompanied by nearly 30 percent volume growth, indicating that demand expansion was not solely driven by pricing. It further noted that EBITDA margins expanded by more than 650 basis points year-on-year, exceeding market expectations.

The latest performance also reflects a broader shift underway within India’s fast-growing beauty and personal care industry, where digital-first brands are increasingly focusing on profitability and offline scale rather than pure online customer acquisition growth. Honasa Consumer’s expansion into general trade and modern retail appears to have strengthened its market reach at a time when competition in the direct-to-consumer segment remains intense.

The company stated that it billed 1.2 lakh outlets directly through distributors during FY26, signalling a significant scale-up in offline distribution infrastructure. This expansion is strategically important because offline retail remains a dominant consumption channel in India’s personal care market despite rapid e-commerce adoption over the past decade.

Another important development was the sustained momentum in younger brands. Honasa Consumer said these brands grew 40 percent year-on-year during FY26 across online and offline channels. The Derma Co, in particular, continued to deliver strong growth while maintaining a double-digit EBITDA profile, suggesting that premium skincare remains a high-growth category within the broader beauty segment.

For the full FY26 financial year, consolidated net profit rose sharply to Rs 200.19 crore from Rs 72.68 crore in the previous year, while total consolidated income increased over 15 percent to Rs 2,475.52 crore.

The board also approved the company’s maiden final dividend of Rs 3 per equity share. The payout amounts to 51.2 percent of FY26 standalone profit after tax and may be viewed positively by investors seeking evidence of improving cash generation and capital discipline in new-age consumer businesses.

From a market perspective, the earnings could improve sentiment toward listed digital-first consumer companies, many of which have faced valuation pressure due to concerns around profitability, rising competition, and slowing discretionary demand. Honasa Consumer’s margin expansion and improving execution may reinforce investor confidence that select new-age brands can transition from growth-heavy models to more balanced profit-oriented businesses.