Honasa Consumer Limited, the company behind popular beauty brands like Mamaearth and The Derma Co., has announced the successful completion of a major strategic project called “Project Neev”. This initiative has restructured the company’s entire distribution system to improve its offline sales and operations.

The project involved a fundamental change in how products reach stores. The company moved away from a complex, two layer distribution system that involved super stockists. Instead, it has now adopted a simpler, direct, single distributor model in key major cities across India.

A senior company executive stated that Project Neev is the essential foundation needed to achieve Honasa’s ambitious, long term growth goals. While executing a change of this scale was complex, the company is confident this streamlined structure will lead to better market penetration and stronger financial returns in the near future, solidifying its offline business backbone.

The company acknowledges that this overhaul required a one time adjustment to correct inventory levels across the old distribution network. This necessary step to clear out older stock and reset the sales channels temporarily impacted short term revenue and profit numbers, which led to recent fluctuations in the company’s stock price.

Management confirms this financial variance is solely due to this one time correction and does not reflect the underlying consumer demand for its products. The company’s focus has now fully shifted to taking advantage of the new, more capable distribution model.

The long term goal of Project Neev is to build a stronger, more flexible distribution system that can support the rapid growth of its brands. Key benefits include improved operational efficiency by reducing system friction and costs. It also gives the company greater direct control over product placement and freshness in stores. Most importantly, it ensures the company’s offline sales strategy is robust enough to support continued expansion into various retail channels across India.

Honasa Consumer Limited remains committed to creating long term value for its shareholders by making strategic investments, like Project Neev, that support its goal of market leadership in India’s dynamic beauty and personal care industry.