Nykaa clocks strong growth across verticals in Q2; stock rises over 3%

Cosmetics-to-fashion retailer Nykaa’s shares were in high demand on Friday after the company released a strong quarterly business update showing growth across segments. The stock of Nykaa parent FSN E-Commerce Ventures jumped as much as 3.4 per cent to Rs 151.55 apiece on BSE.  

At around 11:46 am, Nykaa shares were left with a gain of 1.4 per cent at Rs 149 apiece on the bourse, having halted a three-day losing streak. The stock closed 1.43 per cent higher on BSE at Rs 149.05 apiece. 

In a quarterly performance update released before market hours on Friday, the company said consumption in the beauty and personal care (BPC) category remained healthy, with the segment’s net sales value (NSV) expected to grow around 20 per cent on a year-on-year basis in the July-September period. 

The company said that its overall performance in the first six months of the financial year positions it well for the entire year, as the second half of the year historically witnesses superior consumer demand. Nykaa also said that the upcoming festive season will be a significant growth driver. 

The company also said its ‘Hot Pink Sale’, in July, received a good response. Nykaa Fashion has beaten the overall weakness in the apparel industry and recorded good growth driven by improvement in its order volumes, according to the company.  

"Within the quarter, Nykaa Fashion has optimised the core category mix along with improvement in order volumes," Nykaa added. 

It also said that it expects the net sales value of Nykaa Fashion to grow 30 per cent in the three-month period. 

Nykaa expects to maintain growth in the gross merchandise value (GMV) in the BPC category to continue at 21 per cent. It expects GMV in the fashion segment to remain at nine per cent.  

Nykaa shares: Past performance 

In 2023 so far, FSN E-Commerce Ventures' shares have lost about 3 per cent of their value, in stark contrast to a rise of nearly 8 per cent in the Nifty50 index.

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