All About Nykaa IPO: Check Issue Date, Price, Lot Size & Details

Nykaa is a consumer technology platform that provides consumers with a content-driven, lifestyle shopping experience. It was founded in 2012. The company manufactures its own-brand products as well as beauty, personal care, and fashion items. There are two key verticals in which the company operates:

• Nykaa: Beauty and personal care
• Nykaa Fashion: Apparel and accessories

The Beauty & Personal Care Offering included 197,195 SKUs from 2,476 brands as of March 31, 2021, with a focus on make-up, skincare, haircare, bath and body, fragrance, personal care, and health and wellbeing. Nykaa’s beauty and personal care offerings are primarily inventory-driven. Third-party manufacturers produce the company’s brand beauty and personal care products, which are offered under the names “Nykaa Cosmetics,” “Nykaa Naturals,” and “Kay Beauty.”

There are 1,350 brands and over 1.8 million SKUs in the apparel and accessories categories, featuring stylish products for women, men, kids, and home. Six of Nykaa Fashion’s brands are owned by the company.

Customers get an omnichannel purchasing experience from the organization because it offers both online and physical shopping options. Mobile apps, websites, and mobile sites are examples of online channels, whereas offline channels include 73 actual stores scattered across 38 Indian cities.

Nykaa IPO

According to persons with knowledge of the situation, FSN E-Commerce Ventures, the parent company of India’s largest cosmetics etailer Nykaa, will undertake an initial public offering (IPO) on October 28 to earn up to Rs 5,352 crore.

“An anchor placement of up to Rs 2,340 crore will open on Wednesday (October 27), and the initial public offering (IPO) will finish on Monday, November 1,” according to one of the sources mentioned above.

Founder Falguni Nayar and her family will continue to own a majority stake after the IPO. They currently hold more than 53% in the Company

Nykaa is one of the most well-known omnichannel beauty and wellness businesses. The company also sells a wide variety of clothing and accessories. Every month, its digital platform serves the needs of almost 5 million active consumers.

It sells items from over 2,000 different companies in a variety of categories. Skincare, health supplements, make-up, and other cosmetics are examples. Nykaa has more than 12 warehouses dedicated to its fashion and cosmetic products in India as of 2021.

Company said it would use Rs. 200 crore to market its brands and Rs 130 crore from the IPO proceeds to repay its debt.

Objectives:

• General corporate objectives are met.
• To meet the company’s capital spending needs.
• Expanding its activities in a market where investors are showing extraordinary interest.

Why should one invest in the Nykaa IPO?

Nykaa, an omnichannel marketplace dedicated to beauty and wellness items, has a lot of room to grow in the personal care space. This is due to a mismatch between latent demand and supply in the premium and mass segments.

By developing a large range of high-availability items, the company has already been able to close the supply gap. Its multi-channel sales strategy has been critical in this regard. Furthermore, the pandemic has had a favorable impact on Nykaa’s client adoption.

Overall, Nykaa’s prospects appear to be bright, thanks to the growing popularity of digital platforms and the rise of India’s beauty industry. As a result, once the IPO of this company’s planned initial public offering is open for subscription, investors may want to consider booking shares.

Nykaa IPO Analysis

Strengths

1. Nykaa is constantly expanding its product line and offers, resulting in a well-rounded portfolio. This has helped the company grow its consumer base. Furthermore, by continuously updating its offerings, this organization has positioned itself to meet the challenges offered by the dynamic business environment.
2. Nykaa has room to grow thanks to its good financial position. It can use the money to support new projects, diversifying its revenue stream. Its major financial measures, such as Return on Equity (ROE), Return on Sales (ROS), and others, will benefit as a result.
3. This business uses an inventory model to ensure that it has enough inventory to fulfill demand.
4. Nykaa regularly undertakes social media marketing efforts. This has been beneficial in terms of increasing sales and attracting new clients.

Weaknesses

1. Nykaa’s backend procedures have been connected with technology. However, it has been unable to capitalize on technology advancements in front-end procedures.
2. Nykaa does not devote enough resources to expanding its research and development facilities. This has the potential to have a direct impact on the company’s performance.
3. Nykaa is still having trouble dealing with client problems effectively. This may have an impact on the company’s growth.
4. Nykaa imposes delivery fees if the order value is less than a particular level, effectively excluding potential customers.

Opportunities

1. With the rise in the standard of living, more people are turning to e-commerce, which gives Nykaa a wonderful chance.
2. The organization may make use of AI advancements to forecast consumer demand and meet the needs of niche markets.
3. The e-commerce business strategy of Nykaa can help this company collaborate with local suppliers and logistic organizations that serve worldwide markets. Aside from that, the company’s social media growth may allow it to reach a huge number of potential customers with a small marketing investment.

Threats

1. Nykaa’s intentions may be affected if any changes in domestic laws and tax obligations occur as time goes on.
2. Both online and offline, the number of rivals is growing. As a result, there’s always the risk of losing customers.
3. If consumers’ spending levels fall, this company’s profits may suffer.

Highlights

1. This Mumbai-based firm operates more than 75 physical locations across India.
2. Nykaa became a unicorn company in 2020 after obtaining about Rs.166.6 crore in Series E3 funding led by Steadview Capital.
3. Nykaa processes 1.5 million orders every month and has over 15 million registered users.
4. Nykaa finalized the acquisition of Pipa Bella, an online jewelry brand, in April 2021 before declaring its intention to go public.

Financial Highlights

Aside from revenue, there are a few other indicators that investors should be aware of:

1. Nykaa recorded a net profit of Rs. 61.96 crores in FY2021, with income from operations of Rs. 2453 crores, compared to a net loss of Rs. 16.34 crore in the Previous year. EBITDA (earnings before interest, taxes, depreciation, and amortization) for FY2020 was Rs. 94 crores.