Honasa shares rise sharply after favorable court decision

Honasa Consumer has obtained a favorable court judgment against RSM General Trading.

What happened: The Delhi High Court has directed RSM General Trading LLC to quash its enforcement proceedings in Dubai against Honasa Consumer.

This proceeding was in connection with a suit filed by RSM General Trading accusing Honasa of wrongfully terminating its distributorship. The court has also directed RSM to deposit ₹57.17 crore, representing the damages claimed, in the registry of the Delhi High Court.

The judgment was announced on August 20. This decision of the court is expected to have a positive impact on Honasa’s financial development as it protects against the enforcement of the judgment of the Court of First Instance in the United Arab Emirates, Dubai.

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The court has stipulated that the deposited amount will remain with the registry until RSM provides evidence of withdrawal of the enforcement proceedings. If the Dubai court authorizes the enforcement of the judgment against Honasa, the registry will release the amount to the company.

Honasa Consumer Limited had filed a suit under Section 9 of the Arbitration & Conciliation Act, 1996 in the Delhi High Court against RSM General Trading LLC. RSM General Trading LLC had filed a suit in the Dubai Court alleging wrongful termination of its distribution agreement by Honasa.

Price promotion: Honasa’s share price rose 0.49% to close at ₹467.95 on Wednesday afternoon.

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