Shares of FSN E-Commerce Ventures Ltd (Nykaa) fell over 3 per cent in Tuesday’s trade, ahead of its June quarter results. Analysts said the management’s commentary on industry trends in Beauty & Personal Care (BPC) and Fashion; competitive landscape and international expansion plans would be keenly watched. The stock fell 3.03 per cent to hit a low of Rs 188.55 on BSE.
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JM Financial expects Nykaa’s gross merchandise value (GMV) to grow 25 per cent YoY in Q1 on rising BPC consumption. It said BPC’s GMV is expected to grow 24 per cent YoY, with offline business impacted by elections and heatwaves across North India. Investments in the customer acquisition are likely to result in lower GMV-NSV (net sales value) conversion of 58 per cent in BPC, it said.
“Muted demand environment in overall fashion industry continues to persist. With 1Q being seasonally weak due to limited weddings and festivities, Fashion GMV is likely to be muted at 16 per cent YoY growth. However, with declining leakages and lower RTOs, GMV-NSV conversion is expected to be stable at 31 per cent.
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Net-net, the brokerage expects Nykaa to deliver 25 per cent growth in GMV and 22 per cent YoY rose Revenue with 9 basis Ebitda margin improvement. From 1QFY25, the company has restructured its segmental reporting. Beauty segment will include the online beauty platform Nykaa, beauty-owned brands, physical stores, eB2B distribution business ‘Superstore by Nykaa’, and Nykaa Man BPC business.
Fashion segment will include Nykaa Fashion platform, fashion-owned brands, content platform LBB, and Nykaa Man lifestyle business.
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Nuvama said its Nykaa may report a 103 per cent YoY rise in profit at Rs 13.10 crore compared with a profit of Rs 6.5 crore in the year-ago quarter. Revenue is seen rising 21.6 per cent YoY to Rs 1,728.20 crore against Rs 1,421.80 crore in the same quarter last year.
Ebitda margin is seen at 5.5 per cent against 5.6 per cent in March and 5.2 per cent in the same quarter last year.
“We expect 21 per cent/28 per cent YoY growth in BPC/Fashion GMV. Overall, we expect revenue to increase 21.6 per cent YoY to Rs 17.3 billion. We expect a slight dip in margin driven by marketing and GCC-related spends,” it said.
