Nykaa Grants 4.05 Lakh ESOPs Ahead of Q4 Results

Ahead of its earnings call for the quarter and year ending March 31, 2024 (FY24), beauty and fashion ecommerce major Nykaa announced that it has granted 4.05 Lakh stock options under its Employee Stock Option Policy (ESOPs) scheme on May 20 (Monday). 

The valuation of the stocks allotted could be around INR 7.15 Cr on the basis of the stock’s opening price of INR 176.75 on May 21. 

The ESOP allotment disclosure comes about two years after the company’s last major employee stock option grant. Under Nykaa’s ESOP 2022 scheme, it granted 16 Lakh shares to its employees and 4 Lakh units under the Stock Unit Plan, 2022.

Under the company’s erstwhile disclosure Stock Unit Plan, the employees who received stocks could exercise their rights within 90 days of the issue at the face value of shares of Nykaa as on grant data. 

With the allotment of the fresh stock plans, the company joins the ranks of startups employing the strategy to increase their employer brand profiles, which incurred heavy dents after multiple mass layoffs reported within the ecosystem. 

According to Inc42’s Inc42’s Indian Startup Founder Survey 2023, about 55% of founders were banking on ESOPs to lure Indian workforce back to the startup ecosystem in 2024. 

This has translated to many companies allotting stock options to their employees. For instance, logistics unicorn Delhivery announced the allotment of 75,000 stock options under its ESOP 2012 just last week. Similarly, majors like Paytm, Cartrade, PocketFM, Spinny, and Cred, among others, have also granted more of their employees company stocks within the past couple of months.

For the Falguni Nayar-led beauty marketplace and house of brands, the ESOP announcement comes a day before it is scheduled to announce its financial results for Q4 FY24 and FY24. Nykaa has maintained confidence over reporting robust growth in the quarter. 

In April, the company said that it anticipates a “mid-twenties YoY” growth in revenue for the  full financial year 2024. It also claimed “early thirties” growth in gross merchandise value (GMV).

In its last disclosed financials for Q3 FY24, the company’s net consolidated profit more than doubled to INR 17.4 Cr from the INR 8.5 Cr profit it recorded in the  year ago quarter. Its operating revenue also grew 22% to INR 1,788 Cr in the reported quarter from INR 1,462 Cr posted in Q3 FY23.