Shares of Honasa Consumer Ltd., the parent company of Mamaearth, experienced a sharp decline of more than 6% in early trade on Thursday following a significant block deal. The stock extended loss after a 3.5% decline on Wednesday.
About 3.5 crore shares, representing 10.9% of Honasa Consumer's outstanding equity, changed hands at a price of Rs 500 apiece. This block deal has been valued at Rs 1,763.3 crore.
The company was in focus after reports suggested that up to 8.1% of its total equity could be transferred through large block deals on Thursday. The deal was reportedly to be executed at a floor price of Rs 480 per share, representing an 8.04% discount to Honasa Consumer's Wednesday closing price of Rs 522.
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Shares of the company fell as much as 6.13% before paring loss to trade 2.50% lower at Rs 508.95 apiece, as of 09:36 a.m. This compares to a 0.62% advance in the NSE Nifty 50.
The stock has risen 47.92% in the last 12 months. Total traded volume so far in the day stood at 17.27 times its 30-day average. The relative strength index was at 50.
Out of 12 analysts tracking the company, 10 maintain a 'buy' rating, one recommends a 'hold' and one suggests 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies an upside of 7.7%.
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