In a notable move amidst broader market fluctuations, foreign institutional investors (FIIs) and mutual funds significantly bolstered their investments in Mamaearth, the direct-to-consumer (D2C) beauty brand, during the June quarter of FY25.
FIIs increased their stake in Mamaearth’s parent company, Honasa Consumer Pvt. Ltd., to 13.95% by the end of the June quarter, up from 12.22% in the previous quarter. This rise occurred despite widespread sell-offs in the Indian equity market during the same period. The number of FIIs and foreign portfolio investors (FPIs) invested in Honasa grew to 128 from 107, indicating rising international interest in the brand.
Simultaneously, mutual funds raised their stake in Mamaearth to 3.56% in Q1 FY25, compared to 3.13% in Q4 FY24. The number of mutual fund schemes invested in the company also increased to 16 from 14, reflecting heightened confidence among domestic institutional investors. However, the Invesco India ELSS Tax Saver Fund, the sole mutual fund holding more than a 1% stake in Mamaearth, slightly trimmed its holdings, reducing its shareholding from 1.56% to 1.41% during the June quarter.
Conversely, alternate investment funds (AIFs) continued to decrease their stake in Mamaearth, holding 9.28% by the end of Q1 FY25, down from 10.17% in the previous quarter. Notably, Fireside Ventures sold a significant portion of its holdings, amounting to a 1% stake, in a bulk deal valued at INR 141.2 crore. Despite this divestment, Fireside Ventures maintained a 4.28% stake in Mamaearth as of the June quarter.
Similarly, foreign venture capital (VC) funds saw a reduction in their collective stake, primarily due to Sofina Ventures selling a 1% stake worth INR 141 crore in June. Consequently, the total stake of foreign VC funds in Mamaearth decreased to 29.53% from 30.53% in the preceding quarter. Meanwhile, Mamaearth’s promoters retained a stable stake of over 35% in the company throughout the June quarter.
Mamaearth, which debuted on Indian stock exchanges in November of the previous year, has exhibited strong market performance, with its share value increasing by a substantial 47% since listing. Financially, the company showcased robust performance in FY24, reporting a full-year profit of INR 110.52 crore compared to a loss of INR 150.96 crore in the previous fiscal year. In Q4 FY24 alone, the company achieved a net profit of INR 30.47 crore, supported by an operating revenue of INR 471.09 crore.
