Nykaa Hits A New Record Low At INR 159.7, Days After Bulk Selling By Kravis Investment

Shares of beauty ecommerce giant Nykaa hit their new all-time low at INR 159.7 on Monday (December 19), falling as much as 5% on the BSE by 2 PM IST.

The new plunge in its share price came days after its pre-IPO shareholder Kravis Investment Partners, which held a 1.13% stake in the company, offloaded shares worth INR 629 Cr via multiple block deals last week.

Kravis Investment held a total of 53.8 Lakh shares of Nykaa till September this year, prior to the startup’s bonus share issue. The VC firm sold a total of 3.7 Cr shares at INR 171 apiece on Thursday. Following that, Nykaa shares fell 2.6% in two straight sessions last week, ending Friday’s session at INR 168.05 on the BSE.

Speaking about Nykaa’s market performance, Jigar S Patel, senior manager, technical research analyst at Anand Rathi told Inc42 last week that there was a possibility of Nykaa hitting a new record low soon.

“There might be a chance that in the coming few weeks the shares will hit a new low at INR 155-INR 156 level,” Patel said, adding that post the fall, Nykaa could move up again till INR 180 level.

Nykaa has been one of the severely battered new-age tech stocks this year, hurt by the overall market downturn due to negative investors’ sentiment on tech stocks, increasing inflationary pressure, and fears of recession. 

From $13.36 Bn on December 31, 2021, Nykaa’s market cap has fallen almost 60% to its current value of $5.55 Bn. 

Shares of Nykaa hit the new all-time low within a month after hitting its last record low of INR 162.58. Last month, after the lock-in period for its pre-IPO investors ended, several early investors, including Mala Gopal Gaonkar, Narotam S Sekhsaria, Lighthouse India Fund III, and TPG Capital, offloaded their stakes in the company. 

However, many analysts had already predicted such large sell-offs in the company given that its pre-IPO investors were sitting on almost 100X returns on their investments.

Despite pre-IPO investors partially or fully exiting Nykaa, several new institutional investors like Goldman Sachs, Canada Pension Plan, ICICI Prudential, Aditya Birla Sun Life Mutual Fund, Societe Generale have bought stakes in the company over the last month or so.

Following Kravis Investment’s sell-off, Goldman Sachs Investments Mauritius and Goldman Sachs (Singapore) Pte together bought Nykaa shares worth INR 220.9 Cr. Canada Pension Plan Investment Board bought 92.5 Lakh shares worth INR 158.2 Cr. ICICI Prudential also bought 87.7 Lakh shares worth almost INR 150 Cr and Mirae Asset Mutual Fund bought 58.5 Lakh shares worth over INR 100 Cr.

Shares of Nykaa are currently trading at INR 160.75, down about 4.3% on the BSE.