Nykaa's growth strategy in BPC includes robust customer acquisition, increasing category width and depth, premiumisation of purchasing behaviour, and delivering exceptional on-ground experiences
Nykaa also plans to double its store count to about 400 by 2027 from 187 at the end of the financial year 2023-24 (FY24)
The company expects its fashion vertical to grow to 2.5-3X over the next three years
Beauty and fashion ecommerce major Nykaa
expects its beauty business to grow at a compounded annual growth rate (CAGR) of mid-to-late 20% till FY28.
During its ‘Annual Investor Day’ on Friday (June 14), the company said that as the online beauty and personal care (BPC) player with over 30% market share in India, Nykaa’s growth strategy in the vertical includes robust customer acquisition, increasing category width and depth, premiumisation of purchasing behaviour, and delivering exceptional on-ground experiences.
Nykaa also plans to double its store count to about 400 by 2027 from 187 at the end of the financial year 2023-24 (FY24).
The Falguni Nayar-led company expects its fashion vertical to grow to 2.5-3X over the next three years. In an investor presentation, the company said that the vertical will turn EBITDA positive in the near future but didn’t mention an exact timeline for achieving the same.
Meanwhile, Nykaa E-Retail CEO Anchit Nayar said that Nykaa Fashion is aiming to breakeven in FY26.
It must be noted that over the last few quarters, Nykaa Fashion has been seeing higher growth than its BPC business. In FY24, Nykaa’s BPC business’ GMV grew 25% year-on-year (YoY) to INR 8,340.9 Cr. On the other hand, the GMV for fashion business grew 27% YoY to INR 3,270 Cr.
Speaking during the investor day today, Nykaa’s founder and CEO Nayar said that the company is working to improve its delivery timelines and is looking to introduce express delivery service in metro cities.
Meanwhile, on the global expansion front, Nykaa aims to extend its Nysaa brand in the Gulf Cooperation Council (GCC) market with a total of 70 stores in the next five years. The company aims to achieve a 7% share in the GCC prestige beauty market in this period.
Besides, Nykaa Global Store aims to increase its total number of brands to 80-100 by FY28 from 39 as of FY24. This segment has grown 5X over the last four years, said the company.
Nykaa has also started leveraging data and advanced ML and AI technologies to create personalised customer experiences and optimise ad selection, which is significantly benefiting its brand partners, the company claimed.
The technological advancements are enabling strategic partners and Nykaa’s consumer brands business to scale their online businesses using top-tier ecommerce and warehouse management tech stacks, Nykaa said.
Nykaa posted an 80% YoY jump in its net profit to INR 69 Cr in FY24, while operating revenue grew 24% YoY to INR 6,385.6 Cr.
Shares of Nykaa ended today’s trading session 2.4% higher at INR 170.95 on the BSE.
