Profitable tech unicorn Nykaa’s IPO to open on Oct 28

Staff Writer   /   October 27, 2021

FSN E–Commerce Ventures Limited (Nykaa), possibly the first profitable unicorn and led by women, is here to tap public markets with its maiden IPO, which will be open from October 28, and will close on Monday, November 1. Incorporated in 2012, Nykaa is an omnichannel beauty e-tailer, delivering a content-led, lifestyle retail experience to consumers. The IPO is expected to raise over ₹5300 crore. After Zomato, this IPO is attracting a lot of eyeballs on account of Nykaa posting annual profits since FY19 and founded by ex-banker Falguni Nayar. Read on to get more details.

Company details

The company was incorporated as ‘FSN E-Commerce Ventures Private Limited’ on April 24, 2012. The company was promoted by Falguni Nayar, Sanjay Nayar, Falguni Nayar Family Trust, and Sanjay Nayar Family Trust. Currently, Promoter holds 214,924,690 Equity Shares in aggregate, representing 45.99% of the issued, subscribed and paid-up Equity Share capital of the company. Falguni Nayar is the Founder, Executive Chairperson & Managing Director and Chief Executive Officer of the company. She has over 26 years of experience in e-commerce, investment banking and broking. Prior to founding the company, she was associated with Kotak Mahindra Capital Co Ltd for 18 years where she also served as a managing director. She has also served on the boards of various companies, including Tata Motors Ltd and Aviva Life Insurance Company India Ltd.

Nykaa offers consumers an omni-channel experience with an endeavor to cater to the consumers’ preferences and convenience:

• Online: The company’s online channels include mobile applications, websites and mobile sites. As of August 31, 2021, they had cumulative downloads of 55.8 million across all their mobile applications and during the Financial Year 2021, 88.2% of their online GMV came through their mobile applications.

• Offline: Their offline channel comprises 80 physical stores across 40 cities in India over 3 different store formats as of August 31, 2021.

Nykaa has two business verticals:

• Nykaa: Beauty and personal care

• Nykaa Fashion: Apparel and accessories

IPO details

FSN E–Commerce Ventures’ (Nykaa) Initial Public Offering is for up to 47,575,326 equity shares of face value of ₹1 each for cash at a price of ₹ 1,085 – 1,125 per equity share. This aggregates up to ₹ 53,497 million comprising a fresh issue of up to 5,602,666 equity shares aggregating up to ₹ 6,300 million (the fresh issue) and an offer for sale of up to 41,972,660 equity shares aggregating up to ₹47,197 million by the selling shareholders. The offer and the net offer would constitute 10.06% and 10.01%, respectively, of post-offer paid-up equity share capital.

The IPO bids can be made for a minimum of 12 equity shares and in multiples of 12 equity shares thereafter. This means as a retail investor applying for 1 lot of Nykaa IPO shares would cost you ₹13,500 at the upper price band of ₹1,125.

The Equity Shares offered are proposed to be listed on BSE and NSE.

The implied company market cap is at Rs 53,204 crore.


Nykaa’s revenue for FY 2021 was at Rs 2,452 crore VS Rs 1,777 cr while profit for the year in the FY 2021 was Rs 61.9 cr, as compared to a restated loss of Rs 16.3 cr for 2020.


At the upper price band of Rs 1125, the PE works out to be 839x and the price to sales comes at 21.6x to its FY21 earnings.

Brokers’ view

IIFL Securities: Nykaa, a specialised beauty e-tailer, has the perfect combination of growth (44% BPC GMV Cagr over FY19-21) and profitability (6.6% Ebitda margin in FY21) driven by its superior product assortment, content creation and discovery engine. It is now replicating the same model in Fashion. We estimate 37% total revenue Cagr over FY21-26 and an Ebitda of Rs 13.7 billion in FY26. Our DCF based SOTP arrives at a 12 month forward market cap of USD 9 billion.

JM Financial: FSN E-Commerce Ventures Limited is a digitally native consumer technology platform, delivering a content-led, lifestyle retail experience to consumers. Since the incorporation of the company in 2012, they have invested both capital and creative energy towards designing a differentiated journey of brand discovery for their consumers. The company has a diverse portfolio of beauty, personal care and fashion products, including their owned brand products manufactured by them. In the Financial Year 2021, the company’s GMV was ₹4045.98 crore, which grew 50.7% from the Financial Year 2020. The company’s restated profit for the year in the Financial Year 2021 was ₹61.94 crore, as compared to a restated loss of ₹16.34 crore for the Financial Year 2020.

Swastika: Nykaa redefined the art of e-retailing beauty and personal care in India. Q1FY22 financials also looked better than previous years, but need to see how it grows further. The beauty and personal care market have a large market opportunity especially in India where millennials are more into buying brands and look for easy buying options such as e-commerce. The valuation of the IPO is pretty high however eyeing the higher valuations of other unicorns we may expect some listing gain. Thus, we assign a “SUBSCRIBE” rating to the IPO only for listing gains.

CompanyFSN E–Commerce Ventures (Nykaa)
Open DateOct 28, 2021
Close DateNov 1, 2021
Allotment DateNov 8, 2021
Listing DateNov 11, 2021
IPO band₹1085 to ₹1125 per equity share
Share face value₹1
Bid Lot12 shares
IPO RegistarLink Intime India Private Ltd

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