Mamaearth's Parent Company Honasa Puts IPO On Hold Due To Weak Mkt Conditions: Report

Leading skincare company Honasa Consumer Limited which owns Mamaearth has put its initial public offering (IPO) on hold, according to Reuters. Sources whom Reuters spoke to cited weak market conditions as the reason behind this development.

Two people who spoke to the Reuters confirmed the development, saying weak market conditions are the reason behind the decision. It comes just a month after two other Indian companies scrapped their share sales.

Honasa Consumer Ltd, the parent company of Mamaearth, filed its documents for an IPO in December, planning to raise about $200 million to $300 million, which could have valued the company at up to $3 billion, stated Reuters report.

However, Mamaearth is now in a "wait and watch mode", according to the sources quoted in the report.

Mamaearth, founded by the husband and wife duo of Varun and Ghazal Alagh, has been betting on the growth of India's booming beauty and personal care market, which is estimated to expand to $30 billion by 2026 and has been growing 12% per year.

It is worth mentioning that Mamaearth was last valued at $1.2 billion dollars in January 2022. The company had planned to start marketing the IPO and begin initial talks with investors by the end of January, but that has not happened yet, as per the sources quoted in the Reuters report.

Mamaearth has until December to receive approval for the IPO from the Securities and Exchange Board of India (SEBI) and file its final prospectus. While it still plans to go for a public listing, it has currently put its plan on hold. It could reevaluate market conditions and start its marketing process by October if the sentiment improves, said the sources.