Nykaa Q4 Results: FSN E-Commerce Ventures, the operator of beauty and fashion retailer Nykaa, released its January-March quarter results for fiscal year 2023-24 (Q4FY24) on Wednesday. The company reported a substantial four-fold increase in quarterly net profit attributable to shareholders, driven by customer retention over heavy discounts. The net profit surged by 187 percent to ₹6.9 crore in Q4FY24, up from ₹2.4 crore in the same period the previous year.
Under the leadership of Falguni Nayar, the company’s revenue from operations increased by 28 percent in the March quarter, reaching ₹1,668 crore compared to ₹1,302 crore in the same period last year. This growth was fueled by affluent consumers’ preference for luxury makeup and fragrances from brands like Estee Lauder, Bobbi Brown, and Dior.
1. Nykaa BPC Segment
Nykaa’s beauty and personal care (BPC) segment, the largest in terms of revenue, experienced a 30 percent growth in gross merchandise value (GMV) during the March quarter, marking the highest growth in the last six quarters. This was driven by accelerated customer acquisition and increased order growth. The BPC segment surpassed $1 billion (₹8,340 crore) in GMV for the fiscal year FY24, showing a 25 percent year-on-year growth. As of March 31, 2024, Nykaa had 187 physical stores across 68 cities, adding 42 stores during the year.
2. Nykaa Fashion
Nykaa’s end-of-season sales and the ‘Pink Love Sale’ before Valentine’s Day boosted volumes. The fashion business strengthened its position as a premium women’s fashion destination. Nykaa Fashion GMV grew 27 percent year-on-year in FY2024 and Q4 FY2024, driven by high growth in core categories like women’s Indian and western wear, as well as emerging categories like lingerie and activewear.
3. Mergers & Acquisitions
As part of its expansion strategy, FSN E-Commerce’s board approved the acquisition of it’s Fashion’s western wear and accessories business through a slump sale, aiming to consolidate its owned brand business. Additionally, their Fashion was merged with Illuminar Media’s LBB, acquired in August 2022, to enhance content discovery and delivery. The board also approved a ₹20 crore investment in FSN International, a wholly owned subsidiary that exports and retails BPC products internationally.
4. Owned Brands
Company owned brands achieved over ₹1,500 crore in FY24, encompassing mature, mid-size, and emerging brands in beauty and fashion. Beauty-owned brands grew 39 percent in FY2024. Dot & Key, a D2C skincare brand acquired in September 2021, reached a ₹600 crore GMV run rate (annualized for Q4 FY2024), scaling 10x since acquisition. Dot & Key is among the top skincare brands across all platforms with bestsellers in moisturizers, sunscreen, and lip balms. It’s Fashion’s house brands and other channels now contribute 12.7 percent to overall fashion GMV.
5. Other Announcements
Nykaa reappointed three independent directors—Pradeep Parameswaran, Seshashayee Sridhara, and Santosh Desai—for another three years starting July 1. The distribution business, Superstore by , saw strong GMV growth of 84 percent year-on-year in FY2024, with an 81 percent growth in Q4 FY2024. The distribution business has scaled with improving profitability, as the contribution margin improved by 919 basis points year-on-year, from -27.4 percent in FY2023 to -18.2 percent in FY2024. Ahead of the Q4FY24 results announcement, Nykaa shares closed 0.99 percent higher at ₹179.05 each on the BSE.
To conclude, Nykaa’s robust performance in FY24 highlights significant growth across its key segments and strategic initiatives. The beauty and personal care (BPC) segment saw impressive growth in GMV, driven by customer acquisition and increased orders, surpassing $1 billion for the fiscal year. Nykaa Fashion also reported strong results, bolstered by successful sales events and a focus on premium women’s fashion.
The company’s expansion strategy through mergers and acquisitions, such as the integration of Nykaa Fashion with Illuminar Media’s LBB, and the consolidation of owned brands, demonstrates a commitment to strengthening its market position. It’s owned brands achieved notable milestones, with substantial contributions to overall GMV. Additionally, the reappointment of independent directors and significant growth in the distribution business underscore it’s strategic focus on governance and profitability. These achievements reflect their solid foundation and strategic direction, positioning it for continued growth and success in the competitive beauty and fashion retail market.
