At a Glance
Nykaa promised to glam up Indian e-commerce with lipstick, influencers, and profitability. Five years later, revenue’s up 3x, profit exists (barely), but valuations look like they’re still wearing 2021’s runway price tags. Fashion may rotate — but those 800x P/E dreams? Time to declutter.
1. 🚨 TL;DR
- Revenue (FY21 → FY25): ₹2,441 Cr → ₹7,950 Cr ✅
- Net Profit: ₹62 Cr → ₹72 Cr (…after ₹8,000 Cr in sales) 🤦
- Stock Performance: From IPO high of ₹430+ → ₹194 now. Down ~55%
- Operating Margins: Up from 4% to 6% — but still anaemic
- P/E: ~839x. No, that’s not a typo.
- ROCE/ROE: Both below 10%
- Cash Flow (FY25): Finally positive at ₹467 Cr OCF
- Fair Value Range (FY26E): ₹120 – ₹145
- Verdict: Great brand. Bad stock. Better product shelf than P&L.
2. 💋 Business Model: Influencer-First, Profit-Later
Nykaa isn’t a regular D2C startup — it’s an entire content + commerce + chaos ecosystem:
- Beauty & Personal Care: Majority revenue, strong owned brands (Nykaa Cosmetics, Kay Beauty)
- Fashion: Huge drag. Bleeds cash every quarter.
- Marketplace + Private Labels: Combo model. But private labels carry better margins.
- Omnichannel: 180+ stores. Offline isn’t scaling margin — just cost.
- Average Order Value: Best in India (~₹1,800+), but growth slowing
In short, Nykaa sells you foundation while quietly eroding its own.
3. 🧾 Financials: Sales are Cute. Profits, Not So Much.
💹 Revenue Growth (Consolidated):
- FY21: ₹2,441 Cr
- FY22: ₹3,774 Cr
- FY23: ₹5,144 Cr
- FY24: ₹6,386 Cr
- FY25: ₹7,950 Cr
CAGR: 34% — solid top-line runway
😬 Net Profit:
- FY21: ₹62 Cr
- FY22: ₹41 Cr
- FY23: ₹21 Cr
- FY24: ₹40 Cr
- FY25: ₹72 Cr
That’s ₹72 Cr profit on ₹7,950 Cr revenue. Less net margin, more guilt trip.
💥 OPM:
- FY21: 6%
- FY25: 6%
Still a thin-margin game in a discount-hungry world.
4. 🧮 Key Ratios That Scream “Avoid Until Further Notice”
| Metric | FY22 | FY24 | FY25 |
|---|---|---|---|
| ROCE | 7% | 7% | 10% |
| ROE | 3% | 4% | 5% |
| Debt | ₹593 Cr | ₹969 Cr | ₹1,321 Cr |
| OCF | -₹354 Cr | ₹0 Cr | ₹467 Cr |
| P/E | NA | 1300x+ | ~839x |
Yes, debt rose. Yes, cash flow turned around. But P/E still belongs in a Netflix sci-fi movie.
5. 💼 Ownership, Execution, and All That Pink Drama
- Promoters: Falguni Nayar & family hold 52.16% — rock solid.
- FIIs: Down from 12.3% in 2023 → 8.8% now
- DIIs: Faith restored — jumped from 7.8% to 25.2% in 2 years ✅
- Public: Slashed stake from 38% → 13.8% — retail got rugged.
Execution? Solid. Transparency? Decent. But fashion segment? Financially disastrous.
6. 🛍️ Competitive Position: A Beauty in a Sea of Beastly Numbers
| Company | FY25 Sales | Net Profit | OPM | ROCE | P/E |
|---|---|---|---|---|---|
| Nykaa (FSN) | ₹7,950 Cr | ₹72 Cr | 6% | 10% | 839x |
| CarTrade Tech | ₹170 Cr | ₹46 Cr | 27% | 8% | 59x |
| Swiggy (Unlisted) | ₹4,410 Cr | -₹1,081 Cr | NA | NA | NA |
| Mamaearth | ₹1,900 Cr | ₹100 Cr | 12% | 15% | ~70x |
Nykaa is the biggest in beauty, but still gets outclassed in earnings by far smaller rivals.
7. 📉 Valuation & Fair Value Range
Current Price: ₹194
Market Cap: ₹55,436 Cr
FY25 EPS: ₹0.23
FY26E EPS: Est. ₹0.5 (being generous)
Realistic P/E: 250x (for premium brand, high-growth optionality)
Fair Value Range (FY26E)
- ₹0.5 EPS × 250x = ₹125
- Aggressive case: 290x = ₹145
👉 Fair Value Range: ₹120 – ₹145
(You’re paying nearly 4x book value for ~0.3% yield and ~5% ROE. That’s not premium. That’s delusion.)
💅 Final Verdict: Buy the Lipstick, Not the Stock
Nykaa is India’s beauty and fashion crown jewel — but the crown weighs too heavy on earnings.
- Beauty biz = great.
- Fashion = certified loss center.
- Profit = slow, painful climb.
- Valuation = floating in 2021’s hot tub.
Until fashion gets profitable and ROCE moves into double digits, the stock is a runway model with a twisted ankle.
Buy their kajal, sure. But unless profits get a makeover — keep the portfolio clean.
✍️ Written by Prashant | 📅 19 June 2025
🏷️ Tags
FSN E-Commerce, Nykaa, Nykaa Stock Analysis, Beauty E-commerce India, Indian D2C Brands, Nykaa Fashion Losses, High P/E Stocks India, FSN Ventures Analysis, Falguni Nayar, EduInvesting Recap, Nykaa Profitability, Indian IPO Bubble, E-Commerce Stocks 2025, Retail Sector India, Nykaa Financials
