Nykaa Shares Dip 25% from Peak: Time to Invest?
7th Jan 2025
Nykaa's BPC Segment Continues Strong Growth
FSN E-Commerce Ventures Ltd (Nykaa) shares are in the fair value zone after a 25 per cent slide, said analysts, as the company reported low-thirties YoY growth in its beauty & personal care (BPC) segment for the December quarter. Analysts noted the eB2B now accounts for 8 per cent of the BPC segment's gross merchandise value (GMV). JM Financial suggested a target of Rs 240 on the stock, while Nomura India gave a price target of Rs 203 and Morgan Stanley valued it at Rs 200, implying up to 39 per cent potential upside.
Nykaa Fashion Sees Muted Performance
Nykaa Fashion continued to report muted growth with net sales value (NSV) rising in mid-teens. However, JM Financial said its channel checks suggest the company would still have gained market share considering the sustained pressure in online fashion.
Analysts' Outlook and Valuation Targets
Overall, Nomura India expects Q3 consolidated revenue growth of 27 per cent YoY and Ebitda margin at 5.9 per cent (up 40 basis points sequentially). JM Financial has tweaked its forecasts to factor in significantly lower growth in Nykaa's Fashion segment while also expecting the lower GMV-Revenue conversion in BPC to sustain at current levels for longer than earlier expected. It reiterated Nykaa as one of its top picks in the Internet sector with a March 2026 target price of Rs 240.
FSN E-Commerce Ventures Ltd (Nykaa) shares are in the fair value zone after a 25 per cent slide, said analysts, as the company reported low-thirties YoY growth in its beauty & personal care (BPC) segment for the December quarter. Analysts noted the eB2B now accounts for 8 per cent of the BPC segment's gross merchandise value (GMV). JM Financial suggested a target of Rs 240 on the stock, while Nomura India gave a price target of Rs 203 and Morgan Stanley valued it at Rs 200, implying up to 39 per cent potential upside.
Nykaa Fashion Sees Muted Performance
Nykaa Fashion continued to report muted growth with net sales value (NSV) rising in mid-teens. However, JM Financial said its channel checks suggest the company would still have gained market share considering the sustained pressure in online fashion.
Analysts' Outlook and Valuation Targets
Overall, Nomura India expects Q3 consolidated revenue growth of 27 per cent YoY and Ebitda margin at 5.9 per cent (up 40 basis points sequentially). JM Financial has tweaked its forecasts to factor in significantly lower growth in Nykaa's Fashion segment while also expecting the lower GMV-Revenue conversion in BPC to sustain at current levels for longer than earlier expected. It reiterated Nykaa as one of its top picks in the Internet sector with a March 2026 target price of Rs 240.