Honasa margin rises for fifth straight quarter, still trails FMCG peers
Revenue growth outpaced expenses, but other income remained material and a Flipkart settlement change affected reported topline without affecting absolute profit.
Filed 13 Aug 2026, 16:23 IST · after market close · Honasa Consumer Ltd (HONASA)
Key takeaways
- Standalone operating margin rose 7.21 percentage points YoY to 14.32% as revenue grew 19.31% while expenses grew 10.05%.
- Standalone net profit increased 111.30% YoY to Rs 84.31 cr, although other income contributed 19.70% of pre-tax profit.
- Operating margin reached 14.32% after a fifth consecutive quarterly increase, but remained 1.66 percentage points below the 15.98% median of 38 reporting FMCG peers.
Price around the results
Operating leverage lifts standalone margin
Revenue grew 19.31% YoY and 14.59% QoQ, while expenses increased at slower rates of 10.05% and 10.59%, respectively. That gap lifted operating margin by 7.21 percentage points YoY and 3.10 percentage points QoQ. Operating profit consequently rose 140.15% YoY and 46.27% QoQ.
Flipkart settlement change clouds the topline read
Management said a change in the Flipkart group settlement process caused a Rs 29 cr revenue-recognition impact on topline without affecting absolute profitability. The company also said contribution margin remained unchanged despite the settlement change. Other income accounted for 19.70% of pre-tax profit, so reported earnings were not entirely generated by operations.
Margin has climbed each quarter since Q4FY25
Standalone operating margin rose from 4.43% in Q4FY25 to 7.11%, 8.26%, 10.32%, 11.22% and 14.32% over the following five quarters. The latest margin was still 1.66 percentage points below the 15.98% median for 38 FMCG peers that had reported the same quarter. The lower YoY tax rate, down 1.66 percentage points, also supported net-profit growth, while the QoQ tax rate rose 10.03 percentage points.
Market reaction is pending after the post-close filing
The results were filed after market close, so a market reaction was not yet available. After its last eight results, the stock rose six times and fell twice, with a median absolute move of 6.62%.
Q1FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹696 cr | ₹608 cr | +14.59% | +19.31% |
| Other income | ₹22 cr | ₹18 cr | +23.42% | -6.24% |
| Expenses | ₹597 cr | ₹539 cr | +10.59% | +10.05% |
| Operating profit | ₹100 cr | ₹68 cr | +46.27% | +140.15% |
| Operating margin (%) | 14.32% | 11.22% | — | — |
| Interest | ₹2 cr | ₹3 cr | -4.72% | -10.04% |
| Depreciation | ₹8 cr | ₹8 cr | -3.51% | -5.01% |
| Profit before tax | ₹111 cr | ₹75 cr | +48.10% | +106.71% |
| Tax | ₹27 cr | ₹11 cr | +152.86% | +93.46% |
| Net profit | ₹84 cr | ₹64 cr | +30.77% | +111.30% |
| EPS (₹) | ₹2.59 | ₹1.98 | +30.81% | +110.57% |
Operating margin of 14.32% compares with a Fast Moving Consumer Goods sector median of 15.98% across 38 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Contribution margin remained unchanged despite the change in settlement by the Flipkart group.
Problems & risks
- A Flipkart group settlement change caused an INR 29 crore revenue-recognition impact on topline without affecting absolute profitability.
What to watch
- Whether standalone operating margin holds above 14.32% next quarter.
- Whether expense growth remains below revenue growth after the 10.05% YoY versus 19.31% gap.
- Whether other income stays near or below its 19.70% share of pre-tax profit.