Amid a major market decline, investors flocked to purchase shares of Nykaa’s parent company, FSN E-Commerce. On February 11, the stock rose by 3 percent, reaching Rs 175 during trading.
However, the stock had peaked at Rs 229.90 in August 2024, which marked its 52-week high. On February 13, the stock dipped to Rs 139.95, which is its 52-week low.
FSN E-Commerce’s Strong Earnings
FSN E-Commerce, the parent company of Nykaa, reported strong profits for the December quarter. Nykaa’s net profit increased by 51 percent, rising to Rs 26.4 crore from Rs 17.5 crore in the same period last year.
The company’s revenue also grew by 27 percent year-on-year, reaching Rs 2,267 crore compared to Rs 1,789 crore last year.
Brokerage Outlook
Morgan Stanley: Analysts at Morgan Stanley expect a 29 percent compound annual growth rate (CAGR) for FSN E-Commerce from FY24 to FY27.
They are positive about Nykaa’s consistent revenue performance, even in a weak demand environment, and have set a target price of Rs 200.
Mirae Asset Capital Markets: This firm upgraded its rating from ‘Add’ to ‘Buy’, with a target price of Rs 207.
They believe Nykaa’s evolving strategies will help it grow in the fashion sector and expand its presence in the Gulf Cooperation Council (GCC) market.
Nuvama Institutional Securities: Nuvama also has a ‘Buy’ rating for Nykaa, with a target of Rs 205 per share. They forecast strong growth in Nykaa’s beauty
and personal care segment, with improved profitability due to reduced losses in the fashion and EB2B segments.
