On Tuesday, shares of Nykaa’s parent company FSN E-Commerce Ventures Ltd. saw a rise of more than 8%, which is the highest in a year. Brokerage firm HSBC Global Research said in a note that Nykaa is well positioned to reap long-term benefits in skin and personal care. HSBC expects the BPC e-commerce market to grow at 20-30% compound growth annually in the coming decade, with double digit growth.
Nykaa’s pan-India network, growing skin and personal care portfolio and loyal customer base are the reasons for HSBC’s positive outlook. The report also said that the growth of the industry remained sluggish in the third quarter of this financial year, while Nykaa recorded strong growth.
The company expects that the gross merchandise value growth of BPC vertical will be in the range of 25 to 30% and the net sales value growth in the third quarter will be around 20%. In its business update on Monday, the company said Nykaa Fashion has shown strong growth in the December quarter, with GMV growth expected to be around 40% and NSV growth expected to be in the 30 to 35% range.
Rise in company shares
Nykaa shares rose 8.31% to Rs 191.60 during trading on NSE, which is the highest level since November 11, 2022.
The stock has gained 24.16% in the last 12 months, with daily volume at 7 times the 30-day average. According to Bloomberg data, out of 24 analysts tracking the company, 14 have given ‘BUY’ rating on the stock, five have advised ‘HOLD’ and the same number have suggested ‘SELL’. There may be an increase of 17.2% in the target.
