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Results: Honasa Consumer Limited Exceeded Expectations And The Consensus Has Updated Its Estimates
Investors in Honasa Consumer Limited (NSE:HONASA) had a good week, as its shares rose 6.9% to close at ₹484 following the release of its half-yearly results. The result was positive overall - although revenues of ₹15b were in line with what the analysts predicted, Honasa Consumer surprised by delivering a statutory profit of ₹2.23 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, Honasa Consumer's 16 analysts are now forecasting revenues of ₹30.1b in 2027. This would be a meaningful 9.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to grow 11% to ₹9.61. Before this earnings report, the analysts had been forecasting revenues of ₹29.3b and earnings per share (EPS) of ₹9.00 in 2027. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
See our latest analysis for Honasa Consumer
Despite these upgrades,the analysts have not made any major changes to their price target of ₹577, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Honasa Consumer analyst has a price target of ₹700 per share, while the most pessimistic values it at ₹390. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Honasa Consumer's growth to accelerate, with the forecast 20% annualised growth to the end of 2027 ranking favourably alongside historical growth of 13% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Honasa Consumer is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Honasa Consumer following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at ₹577, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Honasa Consumer analysts - going out to 2029, and you can see them free on our platform here.
We also provide an overview of the Honasa Consumer Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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