Home Fashion products Nykaa Hits All-Time Low; slips 19% in one week on weak third quarter results

Nykaa Hits All-Time Low; slips 19% in one week on weak third quarter results

0

Shares of FSN E-Commerce Ventures, the parent company of online beauty retailer Nykaa, hit an all-time low of 1,536 rupees, down almost 7% from BSE in intraday trading of Monday. It fell below its previous low of Rs 1,571.30 hit on January 27, 2022. In comparison, the S&P BSE Sensex was down 1.8% at 57,138 points at 10:53 a.m.

The fashionable cosmetics retailer’s stock has fallen 19% in the past week after the company announced a weak set of numbers for the October-December quarter (Q3FY22).



With last week’s decline, Nykaa’s share price fell by 40% from its all-time high of Rs 2,574 reached on November 26, 2021. The company had issued shares at a price of Rs 1,125 per share during its initial public offering (IPO). The stock had made its market debut on November 10, 2021.

Nykaa on Feb. 9, 2022 announced a 59% year-on-year (YoY) drop in its third-quarter net profit to Rs 29 crore, hit by higher spending and subdued demand for health products. personal care and fashion. Earnings before interest tax, depreciation and amortization (EBITDA) margin contracted 697 basis points to 6.3%, from 13.2% in Q3FY21. On a sequential basis, the EBITDA margin improved by 302 basis points, compared to 3.3% in Q2FY22.

Revenue from the company’s operations increased by 36% year-on-year to Rs 1,098 crore. He said growth in the beauty business accelerated in a relatively normalized Covid environment, with a strong recovery in the cosmetics category. Nykaa’s Gross Merchandise Value (GMV) increased 49% YoY, driven by 32% and 137% YoY growth in the Beauty and Personal Care (BPC) and Fashion segments , respectively.

“Marketing and advertising expenses were 14.0% of operating revenue in Q3FY22 compared to 7.5% in Q3FY21 due to the continued focus on building brand awareness and increasing brand awareness. ‘acquisition of new customers,’ the company said.

Dear reader,

Business Standard has always endeavored to provide up-to-date information and commentary on developments that matter to you and that have wider political and economic implications for the country and the world. Your constant encouragement and feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these challenging times stemming from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative opinions and incisive commentary on relevant topical issues.
However, we have a request.

As we battle the economic impact of the pandemic, we need your support even more so that we can continue to bring you more great content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of bringing you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism we are committed to.

Support quality journalism and subscribe to Business Standard.

digital editor