SUMMARY
The fall in profits came largely on the back of a 55.36% increase in its expenses to INR 889.09 Cr during Q2FY22, compared to the corresponding quarter of last fiscal
The company’s total income during July-September stood at INR 890.46 Cr, 47.2% higher than INR 604.89 Cr reported during the last fiscal
The beauty unicorn’s consolidated GMV in Q2 FY22 grew by 63% YoY and 10% sequentially QoQ to reach INR 1,622.9 Cr
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
Days after making it to the stock exchanges with a stellar listing, FSN E-Commerce, the parent of Nykaa, has reported a 95.4% fall in its consolidated net profit for the July-September quarter.
The beauty and lifestyle marketplace reported a net profit of INR 1.22 Cr during July-September 2021. During the same period of the last fiscal, the beauty and lifestyle unicorn had reported a net profit of INR 26.9 Cr.
The fall in profits came largely on the back of a 55.36% increase in its expenses to INR 889.09 Cr during Q2FY22, compared to the corresponding quarter of last fiscal. Its expenses stood at INR 572.26 Cr during the same quarter of 2020.
The revenue from operations, rose 46.62% YoY to INR 885.26 Cr during the period under review compared to INR 603.77 Cr in the same quarter of last financial year. The company’s total income during July-September stood at INR 890.46 Cr, 47.2% higher than INR 604.89 Cr reported during the last fiscal.
In a regulatory filing, Nykaa said that the gross profit margin in the last quarter was at 42.7%, improving 213 bps on a sequential basis, primarily led by an increase in the share of the gross merchandise value (GMV) from owned brands and an increase in the share of fashion GMV.
The beauty unicorn’s consolidated GMV in Q2 FY22 grew by 63% YoY and 10% sequentially QoQ to reach INR 1,622.9 Cr. According to the company’s press statement:
- Beauty and Personal Care GMV grew by 38% YoY to reach INR 1,185.9 Cr
- Fashion GMV grew by 215% YoY to reach INR 437 Cr
Falguni Nayar, Executive Chairperson, MD and CEO, said: “Increased marketing spends has led to acceleration of customer acquisition, also evident in the unique visitor and transacting customer metrics.” The company also highlighted that its annual unique transaction users reached 7.2 Mn mark in the beauty and personal care vertical and 1.3 Mn for the fashion vertical.
The company has also accelerated its store expansion this quarter, with 8 new physical retail stores, taking the total number of operational physical stores to 84 as of September 30, 2021. Nayar added that the company continues to invest in the expansion of retail stores and fulfilment capacity ahead of the festive season.
During the quarter, the company also launched a beauty and personal care focussed online B2B platform – “SuperStore” for retailers. It also expanded its warehouse storage space by 0.37 lakh square feet during Q2 FY22 resulting in a total warehouse space of 6.65 lakh square feet.
In September 2021, Nykaa acquired a 51% stake in Dot & Key Wellness Private Limited. This marked the entry of the beauty major in the nutraceutical space.
Nykaa’s parent FSN E-Commerce marked a stellar lising on the stock market on November 10, resulting in a 96% return for its investors.
On Friday, its shares on the BSE closed at INR 2,358.90, higher by INR 142.65 or 6.44% from its previous close. Its market capitalisation is currently at over INR 1.11 Lakh Cr.
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.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.