Nykaa’s shares are declining today mainly due to two reasons — not so encouraging Q1 results 2023 and weak stock market sentiments
Shares of beauty and fashion firm FSN E-Commerce Ventures, which operates under Nykaa brand, on Monday declined as much as 11 per cent in the opening trade hitting day’s low of Rs 130 apiece on the BSE. Though the company’s shares have claimed back some of the lost territory, it is still (11:00 am) around 7 per cent lower than its previous close.
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On Friday, August 11, Nykaa’s shares had closed at Rs 146.25.
Brokerage firm Kotak Institutional Equities has downgraded Nykaa’s stock to ‘add’ from ‘buy’ and cut its target price from Rs 210 to Rs 165 a share. Nomura Research also revised downwards the rating to ‘neutral’ from ‘buy’ and reduced the target price to Rs 163 from Rs 183 a share.
“Nykaa’s shares are nosediving today due to two major reasons — not so encouraging Q1 results 2023 and weak stock market sentiments,” said Vaibhav Kaushik, research analyst at GCL Broking, according to livemint.
He added that high-risk traders can buy Nykaa’s shares maintaining stop loss at Rs 125 apiece levels. There can be sharp bounce back if the stock manages to sustain above its crucial support placed at Rs 125 levels.
According to livemint, Avinash Gorakshkar, head (research) at Profitmart Securities said, ‘Nykaa results are not too bad but due to weak global sentiments, Dalal Street is reeling under the sell off heat. We may see sharp rebound in the stock if Nifty manages to sustain above 19,250 levels.”
FSN E-Commerce Ventures on Friday posted an 8 per cent increase in consolidated net profit at Rs 5.4 crore for June quarter 2023-24. The company had clocked a net profit of Rs 5 crore in the same period a year ago.
Profit attributable to equity shareholders, however, declined about 26 per cent to Rs 3.3 crore from Rs 4.5 crore in April-June 2022. Its consolidated revenue from operations increased about 24 per cent to Rs 1,421.8 crore during the quarter from Rs 1,148.4 crore in the corresponding period of 2022-23.
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She said Nykaa Fashion’s growth in the quarter was much ahead than the industry growth but below its long-term trajectory.
“Dot & Key has crossed an annualized GMV run rate milestone of Rs 300 crore, growing five-fold in two years while achieving profitability, demonstrating the successful model of building value with the Nykaa playbook,” Nayar said.
The BSE Sensex on Monday, August 14, declined by about 460 points to 64,862 in the opening trade, owing to pessimism across the Asian indices. The NSE Nifty also declined 154.1 points to 19,274.20 in the early morning trade. The rupee fell 25 paise to 83.07 against US dollar in early trade.
Among 30 Sensex companies, 25 were in the red. Top-5 losers included JSW Steel, Tata Motors, SBI, Bajaj Finserv were Tata Steel, declining up to 2.12 per cent.
Adani group shares also declined as much as 4.20 per cent on Monday, after its auditor Deloitte resigned.
