After a strong response from retail and institutional investors in its IPO around 10 days back, the shares of FSN E-Commerce, which runs beauty and lifestyle marketplace Nykaa, will finally get listed on the stock exchanges today (November 10).
Grey market premiums suggest that Nykaa’s shares may get listed around INR 650 higher than the issue price band (INR 1,085 – INR 1,125).
Aayush Agrawal, Senior Research Analyst – Merchant Banking with Swastika Investmart, said, “We expect Nykaa to get listed around INR 1,600-1,700 where the current GMP is around INR 650 against the issue price of INR 1,125 on the upper price band.”
He noted that keeping in view the new age business and Nykaa’s growth plan, the company is expected to “perform much better”.
Noting that Nykaa’s IPO received a stellar response, Likhita Chepa, Senior Research Analyst, CapitalVia Global Research, said that investors can hold the stock for medium to long term.
The IPO, which opened on October 28 and closed on November 1, witnessed emphatic investor interest right from the opening of the offer. Overall, the IPO was subscribed 81.78 times at the time of closing.
At the upper limit of the IPO price band of INR 1,085 – INR 1,125, the offer has attracted bids of nearly $32.53 Bn.
QIBs subscribed to the earmarked portion of shares by a massive 91.18 times, and the retail portion was subscribed 12 times.
Before the IPO, the beauty and lifestyle unicorn raised over INR 2,395.84 Cr by allocating nearly 2.13 Cr shares to 174 anchor investors, including Blackrock, Fidelity International, the Government of Singapore and the Monetary Authority of Singapore.
The over INR 5,000 Cr IPO included a fresh issue of INR 630 Cr and an offer for sale (OFS) of up to 41,972,660 shares.
Nykaa’s market share in the online beauty and personal care space is estimated to be more than 18.5% (calculated as revenue of FY20/TAM). Overall, India’s online beauty and personal care market is estimated to reach $5.4 Bn by 2025. Purplle, SUGAR Cosmetics, Pureplay, Mamaearth and MyGlamm are a few other players in this market. MyGlamm entered the unicorn club yesterday.