Brokerage Goldman Sachs has raised its target price on Honasa Consumer to Rs 365 from Rs 330, while maintaining a Neutral rating, following a strong Q4FY26 trading update marked by robust growth and margin performance. Honasa reported a better-than-expected quarter, with underlying revenues growing in the high-20s YoY, aided in part by contributions from recent acquisitions. On a reported basis, the company expects revenue growth in the early-20s range.
Margins also surprised positively, with the company sustaining operating margins at levels delivered in the previous quarter—ahead of expectations. Goldman Sachs attributed this to lower ad spends and tighter control over fixed overheads, which helped offset cost pressures.
ALSO READ: TCS Q4 Result Review: Jefferies, Investec Cut Target Price As Analysts Remain Cautious
Mamaearth, Emerging Brands Drive Momentum
The brokerage highlighted continued traction in Honasa's core and emerging portfolio. Mamaearth delivered high-teens growth, while the company's younger brands grew in the early-20s, signalling broad-based demand strength. Channel performance remained healthy, with both general trade and modern trade witnessing strong momentum, supported by improved distribution reach. The offline channel, in particular, continued to be a key growth driver for the company.
Reflecting the strong operational performance, Goldman Sachs has raised its EPS estimates for FY26, FY27 and FY28 by 12.7%, 15.2% and 13.8%, respectively. The upward revision factors in better-than-expected revenue growth and sustained margin performance, even as the company continues to navigate input cost pressures.
Despite the strong quarter and improved earnings outlook, Goldman Sachs has retained its Neutral stance, suggesting that valuations largely factor in the near-term positives. Management has indicated it will continue to take proactive measures to mitigate the impact of potential cost inflation, which remains a key monitorable.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.