Nykaa’s parent company, FSN E-Commerce Ventures, makes lightning debut, lists stocks at Rs 2,018 with 79% premium


The action opened at Rs 2,001 on BSE, while the listing price on the National Stock Exchange was Rs 2,018

Representative image. News18 Gujarati

FSN E-Commerce Ventures, the operator of Nykaa and the Nykaa Fashion chain, made an outstanding debut as a listed stock with a massive 79% premium on November 10.

The action opened at Rs 2,001 on BSE, while the listing price on the National Stock Exchange was Rs 2,018.

The Rs 5,352 crore public issue sparked huge demand and was underwritten 81.78 times during the period October 28 to November 1, receiving offers for 216.59 crore shares against the size of the l offer of 2.64 crore shares.

Qualified institutional buyers and non-institutional investors showed keen interest in the offering, their reserved portion having been subscribed 91.18 times and 112.02 times respectively. Shares reserved for individuals were subscribed 12.24 times and those for employees 1.88 times.

FSN E-Commerce Ventures, a native consumer digital technology platform, is promoted by banker-to-businesswoman Falguni Nayar and backed by private equity firm TPG Group.

The company operates beauty and personal care activities under the Nykaa vertical, where it occupies a leading position and clothing and accessories business under the Nykaa Fashion vertical. It also operates an offline channel, comprising 80 stores in 40 cities in India in three different store formats, as of August 2021.

The Indian beauty and personal care (BPC) market is expected to grow to around Rs 2 lakh crore by 2025, up from Rs 1.1 lakh crore in 2020, and the Indian fashion market is expected to grow to around Rs 8.7 lakh crore by 2025 from Rs 3.8. lakh crore in 2020.

The majority of analysts gave the IPO a “subscription” rating, citing the strong brand and experienced management team of the company, strong finances, leading market share in the market segment. beauty and personal care, its wide product range and strong customer base, etc.

Prabhudas Lilladher recommended taking a note on the IPO, saying Nykaa revolutionized the art of online retailing of BPC products in India.

“Nykaa has been able to create strong consumer tracking and 70% repeat purchases led by 1) inventory-driven BPC model that guarantees authenticity and quality assurance 2) a wide range of products on offer by Nykaa 3) 2 million storage units, 3,826 brands and availability in 24,817 PIN codes 4) consumer education through 1,363 influencers, ~ 39,500 Facebook posts (12.6 million subscribers) and 1, 1 million Youtube subscribers 5) Ability to offer global brands like Estee Lauder, Huda Beauty, Charlotte Tilbury etc. to Indian consumers, 6) private brands like Nykaa Beauty, Nykaa Naturals, Kay Beauty, ”explained the brokerage.

Motilal Oswal also said that he appreciates Nykaa, given its leading position in the online PCB market, its customer-centric approach, its cost-effective technology platform and its efficient business model in terms of capital.

“We believe Nykaa is well positioned to harness the high growth digital / online penetration in the PCB / fashion market. We recommend subscribing,” he said.

Nykaa reported 38.10% growth in operating income to Rs 2,440.89 crore in FY21, compared to the previous year. It recorded a profit of Rs 61.95 crore for fiscal 21 against a loss of Rs 16.34 crore the previous year.

In the quarter that ended in June 2021, it posted revenues of Rs 816.99 crore, a growth of 183.05% year-on-year. Profit during the quarter was Rs 3.52 crore against a loss of Rs 54.5 crore in T2FY21.

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