Nykaa’s condensed profit dropped 70.75% to Rs 8.48 crore in the third quarter of December, potentially arise to retail store investment. FSN E-Commerce Ventures, that operates under the Nykaa brand, revealed a 70.75 percent drop in consolidated profit to Rs 8.48 crore in the third quarter that ended in December, primarily due to retail store investment.
In the same period last year, the firm made a net profit of Rs 29 crore Although, the gross revenue from operations increased by about 33% to Rs 1,462.82 crore in the December 2021 quarter, a rise from Rs 1,098.3 crore.
Statistical Overview
Falguni Nayar, Executive Chairperson, MD, and CEO of Nykaa, stated that the company is working to improve its EBITDA (operational profit) margin. “Beyond EBITDA, we refer to it as an investment for the future. Lease and rental are significant expenses, and they are investing in and opening physical stores and, at the same time, considering an operational cost by us. We also hope to gain 7 million (70 lakh) new customers. All of this is funded by operating expenses, “Nayar stated.
As of December 31, 2022, the company’s SuperStore had grown to 92,415 transacting retailers in more than 650 cities, with 180 brands listed. Nayar stated that the company’s investments are being made in such a way that it remains profitable, but it would be wrong to abandon future investments.
The Company’s Word
According to a statement, the company’s gross merchandise value (GMV) increased 37% yearly to Rs 2,796.5 crore. Beauty and personal care GMV increased by 26% annually (YoY) to Rs 1,901.4 crore, with annual unique transaction customers increasing by 27% to 96 lakh.
The fashion vertical’s GMV increased by 50% year on year to Rs 724.4 crore during the reported quarter, and annual unique transacting customers increased by 50% year on year to 24 lakh.
“The company has consistently delivered strong GMV and revenue growth of 37% YoY and 33% YoY, respectively. The performance has been awe-inspiring given that the third quarter of FY’23 had eight fewer festive days than the third quarter of FY’22, “Nayar stated.
She also stated that the fashion vertical recovered during the quarter. Nykaa Fashion experienced GMV and revenue growth of 50% and 43%, respectively. The fashion vertical now accounts for 25.9% of Nykaa’s GMV.
Final Note
Nayar also clarified its board’s approval of a bonus of five shares for every share held. She stated that approximately 90% of shareholders had voted, with 100% voting in favor of the resolution.
According to Nayar, the only mistake occurred when the allotment was interrupted by 4-5 days due to the cooling-off period required by the rules. “As a result, it is a myth that shareholders were unhappy with the bonus issue,” Nayar explained.
