In 2025, Honasa overhauled its offline distribution under Project Neev, fixing long-standing inefficiency bottlenecks. This hurt growth but restored execution discipline and profitability by mid-year
Mamaearth remains the revenue anchor, but growth is now coming from younger, specialised brands like The Derma Co and Aqualogica, signalling a clear focus on diversification
Honasa is diversifying into oral care, men’s grooming and premium skincare, balancing value-led scale with higher-margin, affluent consumer segments
In 2025, Honasa deliberately razed what it had built over the years. The beauty and personal care (BPC) giant spent much of the year fixing gaps in its offline distribution network and addressing inefficiencies, but most importantly, this was the year when a strategy beyond Mamaearth began to take shape.
Until late 2024, Mamaearth’s offline push ran on a layered model dominated by super stockists and smaller distributors. Although this structure delivered top-line velocity, it also led to delayed replenishments, empty shelves at key retail touchpoints and almost zero real-time visibility into inventory movement. All of these headwinds created execution bottlenecks and blurred brand consistency across markets.
Ironically, Project Neev was Honasa’s answer to these issues. Launched late 2024, it scrapped the super stockist layer and swapped weaker distributors for a pool of high-quality partners capable of servicing retailers directly. The plan was strategically sound, but operationally brutal.
The transition meant inventory corrections, distributor churn, disrupted primary sales and a spell of tepid revenue growth before the new system settled in.
By mid-2025, the reset was complete. Profitability returned, execution stabilised and double-digit growth in ecommerce and modern trade during Q2 FY26 signalled that the foundation had been rebuilt. The stock also bounced back. Amid this, Honasa entered new areas and looked to grab a slice of the premium and prestige market and invested in oral care and men’s personal care, areas where it definitely did not have any meaningful plays in 2024.
With the operational backbone finally restored, Honasa spent the second half of the year reshaping its brand portfolio and category strategy, and laying down fresh long-term growth levers. So, how exactly did 2025 reshape Honasa’s playbook?
Honasa made diversification a key focus of the year. The listed BPC giant expanded its brand portfolio. A review of Honasa’s Q2 FY26 shareholder letter also shows that most new product launches during the period came from these younger labels rather than Mamaearth. The flagship brand still anchors revenue stability, but the risk, experimentation and upside are increasingly being pushed to the newer brands.
Mamaearth remains the flagship identity, but top executives see the brand stretching itself across too many categories, diluting focus and execution clarity.
To remedy this, as part of the post-Neev reset, Honasa ring-fenced Mamaearth around five core categories – face wash, shampoo, sunscreen, moisturiser and baby care – which together contribute nearly 70% of its revenue.
Parallelly, younger brands moved from the sidelines to the centre. The Derma Co, BBlunt, Aqualogica, Dr Sheth’s and Staze Beauty are now the primary growth focus for the company. This reflects Honasa’s disciplined ‘barbell’ strategy – stabilising Mamaearth while pushing growth through younger, more specialised brands. Management commentary throughout the year repeatedly highlighted their faster scaling.
“Globally, the beauty and personal care industry is highly fragmented, and Indian BPC-first players face a similar challenge. It’s difficult to scale meaningfully on the strength of a single brand, which is why we’re seeing a shift toward a ‘house of brands’ strategy. Mamaearth, for instance, expanded through multiple brands and is now diversifying with recent acquisitions, while mCaffeine and Pilgrim are following suit with new sub-brands and extensions,” said Saptarishi Sen of Prath Ventures.
On the Q1 FY26 earnings call, cofounder and chairman Varun Alagh said six brands, including Mamaearth, accounted for over 80% of the revenue. This pattern was reinforced in Q2 FY26 as the younger cohort grew 20% YoY, and The Derma Co hit an annual run rate of INR 750 Cr, becoming Honasa’s second-most-revenue-generating brand.
The Derma Co has also reached an annualised offline run rate of INR 100 Cr, underscoring Honasa’s intent to replicate Mamaearth’s omnichannel footprint for its dermatology-led play.
While quietly rewriting its own multi-brand thesis on the ground, Honasa is also ramping up offline distribution for The Derma Co, which has reached an annualised offline revenue run rate of INR 100 Cr, signalling a clear intent to replicate Mamaearth’s omnichannel playbook for its dermatology-focussed brand rather than keeping it digital-only.
Even as Honasa tightens its focus on core categories, the nine-year-old company continues to be selective in diversifying its portfolio. One such step is Honasa’s entry into oral care.
Earlier this year, the company signed a definitive agreement to secure a 25% stake in Fang Oral Care’s parent, Couch Commerce, for INR 10 Cr. Rather than a full acquisition, the minority stake allows Honasa to test the category while leveraging its operating expertise.
Honasa sees oral care as a high-potential segment ripe for disruption. The company estimates that the oral beauty segment could grow into a $700 Mn opportunity by 2030, driven by rising aesthetic awareness and premiumisation trends within personal care.
The other big swing is men’s grooming. Shortly after the Fang agreement, Honasa announced the acquisition of D2C brand Reginald Men’s parent, BTM Ventures, for INR 195 Cr, marking its formal entry into a segment that it expects to grow to INR 40,000 Cr by 2032.
Reginald’s strength in Southern India gives Honasa immediate regional depth and a platform that can be scaled to over INR 500 Cr in revenue through new categories and deeper omnichannel expansion.
The timing of the acquisition also aligns with broader industry consolidation. As per an industry insider, Mamaearth is taking a leaf out of the playbook of FMCG giants.
For instance, earlier this year, Godrej Consumer Products acquired men’s grooming brand Muuchstac for INR 450 Cr. Emami acquired The Man Company last year for INR 177 Cr.
“The diversification is happening across the breadth of product verticals and across the length of the consumer pyramid. For Mamaearth, this is important as it is in a sector where brand stickiness and brand loyalty matter the most,” said Nirav Karkera, the head of research at Fisdom.
However, he said that these younger brands are operating at a very small scale, and it may take some time to move the needle.
Alongside category expansion, Honasa has intensified its push toward premiumisation. This shift aimed at improving average order values, gross margins, and brand perception.
This year, the company launched Luminéve, a premium skincare brand.
Unlike prior expansions, Honasa chose to incubate Luminéve internally rather than acquire an existing brand, signalling growing confidence in its in-house brand-building capabilities. The brand is being launched on Nykaa, aligning with a premium-first distribution strategy.
Priced above Mamaearth’s core range, Luminéve competes domestically with brands such as Ras Luxury and Seoul Essence, and internationally with players like The Ordinary, Cetaphil, and Neutrogena. The competitive set underlines Honasa’s intent to move beyond value-led propositions and participate meaningfully in higher-margin skincare.
The Reginald acquisition also reflects this premium tilt.
While Honasa built scale through value-conscious products in its early years, Reginald’s pricing suggests a deliberate move toward a more affluent male consumer. This shift, if executed well, could help Honasa balance volume-driven growth with margin expansion.
Overall, FY25 and early FY26 represented a transition phase for Honasa, which exits its reset year with a cleaner operating base, a sharper brand portfolio and clearer growth levers across categories and price points. The pieces are in place, but can execution keep pace as competition intensifies?