Lighthouse India Fund Sells Nykaa Shares Worth INR 252.4 Cr

Lighthouse India Fund III Limited sold 3 Cr shares, worth a total of INR 252.4 Cr, of beauty ecommerce giant Nykaa on Wednesday (November 16) in a bulk deal.

The private equity firm was one of the major pre-IPO shareholders of Nykaa. Last week, Lighthouse India Fund III partially exited the startup by selling over 96 Lakh shares at an average price of INR 171.75 apiece.

The lock-in period for pre-IPO investors of Nykaa expired on November 10.

Nykaa shares fell nearly 4% to INR 184.5 on the BSE on Wednesday following the sell-off. Nykaa saw its highest trading volume on Wednesday after its IPO debut day last year. Over 3.3 Cr shares of the startup were traded today.

Though the lock-in period for its pre-IPO investors expired last week, Nykaa was able to bear the jolt of a few sell-offs as the date coincided with the shares going ex-bonus. Its shareholders were set to receive their bonus shares in their demat accounts by November 15.

There has been a significant downfall in shares of Nykaa since yesterday, as they have fallen over 13% in just two days. 

On Tuesday, Nykaa shares plunged 9.2% to INR 192 on the BSE. Segantii India Mauritius, which purchased almost 38 Lakh shares of the startup last week, sold over 33.7 Lakh of them in a bulk deal yesterday. 

Last week, Narotam S Sekhsaria, who held a 3.11% stake in Nykaa, exited the company by selling his entire stake of 14.7 Mn shares at an average of INR 173.7 apiece. Mala Gopal Gaonkar and TPG Growth also sold their stock in bulk and block deals.

Norges Bank, Aberdeen Standard Asia Focus, Segantii India Mauritius, Societe Generale, and Morgan Stanley purchased over 23 Mn shares of the new-age tech startup last week.

While the stock continues to remain under pressure, the startup seems to be focused on its plan to diversify its portfolio. Nykaa, along with Reliance Retail, Aditya Birla Fashion, Trent Ltd, TPG Capital, and Advent International, has reportedly shown interest in buying a stake in TCNS Clothing, which runs womenswear brands like W and Aurelia, among others.

It is pertinent to note that Nykaa has been trying to aggressively improve its portfolio in the fashion segment. However, it reported a muted growth in the segment in Q2 FY23. Its GMV in the segment grew 43% year-on-year (YoY) growth to INR 599.1 Cr, which was below the street’s expectations.

Nykaa reported a net profit of INR 5.2 Cr in Q2 FY23, up over 300% YoY. However, the growth was almost flat sequentially.

Editor’s Note: The earlier version of the copy erroneously mentioned the number of shares sold as 96 Cr instead of 96 Lakh. The story has been corrected to reflect the same. The error is regretted.