Nykaa Shares up 3% Post Q3 Earnings

Shares of FSN E-Commerce Ventures Ltd, the parent company of Nykaa were up by 3% after the beauty major reported strong Q3 earnings.

Net profit surged by 51% YoY to ₹26.4 crore in Q3FY25, compared to ₹17.5 crore in the year-ago period. Consolidated revenue surged by 27% YoY to ₹2,267 crore in the December quarter, compared to ₹1,789 crore in the corresponding quarter of the previous year. As per its quarterly revenue update on January 5, the revenue growth was in line with company’s projections, which anticipated an increase “higher than mid-twenties.”

The uptick in revenue can be attributed to a surge in the company's core beauty vertical, which clocked heightened growth in the December quarter, compared to previous quarters. Nykaa expects gross merchandise value (GMV) of this segment to grow in the low thirties, buoyed by robust momentum across multiple channels, which includes e-commerce platform, retail stores, owned brands, and eB2B distribution.

As of 10:09 am, shares of FSN-Ecommerce were trading at 172.98 on the NSE. The surge in share price can be attributed to increased trading volumes in the counter. Close to 92 lakh Nykaa shares changed hands, which is higher than one-month daily traded average of 76 lakh shares.

Morgan Stanley expects a 29% CAGR for the company over FY24-27, buoyed by 29% increase in beauty business. Setting a target price of ₹200, the brokerage retained its ‘overweight’ stance on Nykaa.