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Nykaa block deal; VC funding report
Nykaa block deal; VC funding report

Economic Times

time02-07-2025

  • Business
  • Economic Times

Nykaa block deal; VC funding report

One of Nykaa 's early investors is offloading a part of his stake through a $150-million block deal. This and more in today's ETtech Top 5. Also in the letter: ■ Restaurants vs Swiggy , Zomato■ Surge allowance for cab aggregators ■ All about Figma IPO Early Nykaa investor to offload $150-million stake via block deal Harindarpal Singh Banga, founder of Hong Kong-based Caravel Group and an early investor in Nykaa, plans to sell a 2–2.5% stake in the company through a block deal worth $150 million (approximately Rs 1,200–1,300 crore), sources told ET. The numbers: Banga's holding has come down from 8.7% pre-IPO to nearly 5% today. The shares will be sold at a 4% discount to Wednesday's close of Rs 211.80 on BSE. Foreign institutional investors (FIIs) are expected to lap up the offer. Promoters stay put: The Nayar family, which founded Nykaa, still holds 52% and hasn't sold a single share since the company listed in November 2021. Business performance: Nykaa's parent, FSN E-Commerce, reported a Rs 19 crore net profit for the March quarter, nearly double the figure from a year ago. Revenue rose 24% to Rs 2,017 crore, courtesy of strong customer additions and deeper brand tie-ups. On quick commerce: Cofounder Adwaita Nayar told ET in June that Nykaa is testing its quick delivery service, Nykaa Now, in a limited set of pin codes, as it takes a cautious approach to the space.. Venture capital funding inches up to $4.9 billion in H1 2025 Venture capital funding in Indian startups showed early signs of a rebound in the first half of 2025, with total deal value inching up to $4.95 billion across 410 deals, according to data analytics platform Venture Intelligence . Sectors attracting capital: That's a modest improvement on the same period last year, when startups raised around $4.54 billion from 418 deals. Ecommerce led the charge this year, pulling in $1.3 billion, followed by fintech with $1 billion. Enterprise software, deep tech, and health tech also attracted strong investor interest. Big ticket investments: Innovaccer: $275 million Meesho: $270 million ⁠Groww: $200 million ⁠Porter: $200 million Unicorns in 2025: In the first six months of 2025, India saw five unicorns—Netradyne, Porter, Drools, BlueStone, and Jumbotail—compared to only six in the entire last year. IPOs in line: The public markets are beginning to beckon again. Several startups have filed their draft red herring prospectuses (DRHPs) this year, lining up for new listings in the coming months. Expect to see Shadowfax, PhysicsWallah, Boat, Urban Company, Shiprocket, Groww, Pine Labs , Capillary Tech, Wakefit, and Curefoods on that list. Also Read: IPO watch: Which Indian startups are next to hit the stock market? Namakkal restaurants cut ties with Swiggy, Zomato over commission dispute Numerous restaurants in Tamil Nadu's Namakkal have pulled the plug on food delivery platforms like Swiggy and Zomato, cancelling even existing customer orders in protest. The move comes amid increasing frustration among local businesses over what they see as unfair charges and delayed payments. What's happening: On June 23, the Town and Taluk Hotels and Bakery Owners Association held an emergency meeting to address rising tensions with the delivery giants. Members expressed concerns about indirect (and hidden) costs, like advertising fees, which reduce their earnings and profits. The association's secretary, Arulkumaran, pointed out that Swiggy and Zomato apply inconsistent commission rates across restaurants. He added that restaurants are required to wait a whole week after each transaction to receive their payments, resulting in significant cash flow issues for many. The scale of it: In Namakkal taluk alone, 85 eateries are involved in online food sales, generating transactions worth Rs 10 lakh every day. Yes, and: According to Arulkumaran, talks with platforms have failed to yield any meaningful solution, prompting the decision to halt services entirely. Sponsor ETtech Top 5 & Morning Dispatch! Why it matters: ETtech Top 5 and Morning Dispatch are must-reads for India's tech and business leaders, including startup founders, investors, policy makers, industry insiders and employees. The opportunity: Reach a highly engaged audience of decision-makers. Boost your brand's visibility among the tech-savvy community. Custom sponsorship options to align with your brand's goals. What's next: Interested? Reach out to us at spotlightpartner@ to explore sponsorship opportunities. Govt allows Uber, Ola, Rapido to charge 2x of base fare during peak hours Surge pricing just got a lift. The ministry of road transport and highways has updated ride-hailing rules, allowing platforms like Uber, Ola, Rapido, and inDrive to charge up to 2x the base fare during peak hours, up from the earlier 1.5 times cap. States have three months to implement the change, TOI reported. The details: During non-peak hours, fares must be at least 50% of the base rate. States will establish fixed base fares for taxis, autos, and bike taxis. If a state has not set a base fare, the platforms must determine and disclose one. Both drivers and passengers cancelling without reason will face a 10% penalty, capped at Rs 100. Drivers must now have a health cover of Rs 5 lakh and term insurance of Rs 10 lakh. What this means for you: Expect to pay more during peak times—mornings, evenings, weekends, or any high-demand window. While fares increase, driver incomes could also rise, especially in cities with high traffic or high cancellation rates. Safety and quality measures: Platforms must install tracking devices in vehicles, linked to state control centres. Annual refresher training is mandatory for all drivers. Those in the bottom 5% of ratings must attend quarterly sessions or face deactivation. The bigger picture: The government is pushing for a tighter balance between higher driver earnings and better rider experience, with stricter oversight on cancellations, safety, and service. Also Read: Govt issues advisory allowing use of personal two-wheelers as bike taxis; states to take final call Figma's much-anticipated IPO: All you need to know Figma cofounder Dylan Field Cloud-based collaborative design platform Figma is set to list on the New York Stock Exchange ( NYSE ) in one of the most anticipated tech IPOs of 2025, particularly after its $20 billion acquisition by Adobe fell through two years ago. Details: The IPO price range is yet to be announced, but Figma's most recent valuation stood at $12.5 billion. It plans to use the proceeds to fuel its next phase of growth, with a particular focus on expanding its AI capabilities and repaying existing debt. Figma currently serves 13 million monthly active users. Morgan Stanley, Goldman Sachs, Allen & Company, and J.P. Morgan are the lead bankers of the offering. Financials: In the first quarter of 2025, it reported revenue of $228.2 million, representing a 46% increase from the same period last year. Net income for the quarter nearly tripled to $44.9 million. In 2024, the company generated $749 million in revenue, marking a 48% jump from 2023. Also Read: It's a myth that you can't monetise India promise: Figma's Dylan Field

Bangas to sell 2.1% Nykaa stake worth $140.3 million via block deal
Bangas to sell 2.1% Nykaa stake worth $140.3 million via block deal

Mint

time02-07-2025

  • Business
  • Mint

Bangas to sell 2.1% Nykaa stake worth $140.3 million via block deal

Mumbai: Harindarpal Singh Banga, along with Indra Banga, will sell a 2.1% stake worth $140.3 million (approximately ₹ 1,200 crore) in beauty and personal care company Nykaa through a block deal, according to a term sheet accessed by Mint. The Bangas, among Nykaa's earliest investors, are offloading about 60 million shares at an offer price of ₹ 200 per share, a 5.5% discount to the latest closing price, the term sheet showed. FSN E-Commerce Ventures Ltd, which operates Nykaa, closed 2.1% lower at ₹ 211.59 on Wednesday on the National Stock Exchange. The stock has gained 28.7% so far this year. Goldman Sachs and JP Morgan are managing the transaction. Banga, Nykaa, JP Morgan, and Goldman Sachs did not immediately respond to Mint's requests for comment. Banga, a commodities billionaire and chairman of Hong Kong-based Caravel Group, held an 8.7% stake in Nykaa before it listed in 2021. The Nayar family, who founded the company, still owns 52% and has not sold any shares since the IPO. This latest sale comes nearly a year after Banga divested over four crore shares—amounting to a 1.43% stake—at ₹ 208.30 apiece in August 2024, netting ₹ 851.5 crore. Following that transaction, his holding fell from 6.40% to 4.97%. For the quarter ended 31 March, Nykaa reported a near three-fold jump in consolidated net profit to ₹ 20.28 crore from ₹ 6.93 crore a year earlier. Revenue from operations rose 23.61% to ₹ 2,061.76 crore from ₹ 1,667.98 crore in FY24. Over the past year, the company has launched a record number of global beauty brands, forging partnerships with Yves Saint Laurent, NARS, Kerastase, Eucerin, GHD, Armani Beauty, Supergoop, and Nexxus, among others. Nykaa is now shifting toward a more profitable growth trajectory, aiming for mid-20% annual growth in its beauty and personal care (BPC) business over the next five years. The strategy includes deeper market penetration, premiumization, and enhanced convenience. The company plans to scale its physical footprint across tier 2 and 3 cities, increasing store count from 237 to over 500 by FY30. It is also investing heavily in regional influencer marketing, working with over 28,000 influencers to drive discovery. To improve delivery speeds, Nykaa is ramping up its logistics infrastructure. Its two-hour fulfilment model, 'Nykaa Now', is live in seven metros. This is supported by a network of 44 warehouses and 40+ rapid hubs, enabling same- or next-day delivery in key cities.

Nykaa's premium bet: A smart strategy if it delivers
Nykaa's premium bet: A smart strategy if it delivers

Mint

time30-06-2025

  • Business
  • Mint

Nykaa's premium bet: A smart strategy if it delivers

Next Story Manvi Agarwal For Nykaa, steady delivery is crucial for the stock which is up around 25% so far in 2025, making valuations pricier to that extent. Nykaa's FY25 revenue rose 25%. Gift this article FSN E-Commerce Ventures Ltd's analysts meeting last week highlighted that the Nykaa parent is laying the groundwork to scale profitably even as it navigates India's patchy discretionary demand. FSN E-Commerce Ventures Ltd's analysts meeting last week highlighted that the Nykaa parent is laying the groundwork to scale profitably even as it navigates India's patchy discretionary demand. After a 30% rise in FY25 GMV, Nykaa is now targeting mid-20% growth in its beauty and personal care (BPC) business over the next five years. It aims to drive penetration, catalyze premiumization and deliver convenience. The plan involves scaling physical reach across tier 2 and tier 3 markets. Store count is to rise from 237 to over 500 by FY30. Nykaa is also leaning on regional influencer marketing, tapping over 28,000 influencers to boost brand discovery. Premiumization is key. Nykaa's premium users spend nearly nine times the platform average, with the top 10% spending nearing $395 annually, comparable to developed markets. It is strengthening this segment with a broader product portfolio, high-end sub-brands and immersive digital and in-store experiences. Also Read | Nykaa has big plans for house of brands business For faster delivery, its two-hour fulfilment model 'Nykaa Now' is live across seven metros. This complements an expansive network of 44 warehouses and 40+ rapid hubs, enabling same- or next-day delivery in key cities. Yet, fashion, the historically weak link, needs close monitoring. Management reiterated its FY26 Ebitda breakeven and mid-to-high single-digit margins by FY28 target, stabilising at around 10% thereafter. Fashion net sales value is expected to grow 3–4x in the next five years, helped by higher own-brand contribution, better repeat behaviour and falling acquisition costs. Nykaa's fashion average order values are already twice the industry average, skewed towards Gen Z and millennial users. Still, fashion remains a highly competitive and discount-driven space where sustaining margin improvement will depend on sharp execution and continued customer stickiness. The GMV of in-house brands is expected to rise from ₹ 1,700 crore in FY25 to ₹ 6,000 crore by FY30 in beauty alone. These offer stronger contribution margins and greater customer ownership. Flagships like Dot & Key, Kay Beauty, and Nykaa Cosmetics are expanding overseas. Nykaa's FY25 revenue rose 25% with Ebitda margin expanding 60 bps to 6%, aided by operating leverage and a richer product mix. But scale brings challenges, from managing a wider retail footprint to sustaining growth across verticals. While peak investment in warehouse and office infrastructure is behind Nykaa, balancing growth with efficiency would have a bearing on near-term profitability. Plus, when demand is muted, even a minor execution error could dampen investor sentiment. Steady delivery is crucial for the stock that is up around 25% so far in 2025, making valuations pricier to that extent. Topics You May Be Interested In Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

Nykaa stock nears 52-week high: Will the rally continue? Here's what brokerages say
Nykaa stock nears 52-week high: Will the rally continue? Here's what brokerages say

Mint

time30-06-2025

  • Business
  • Mint

Nykaa stock nears 52-week high: Will the rally continue? Here's what brokerages say

Shares of FSN E-Commerce Ventures, the parent company of beauty and fashion platform Nykaa, have seen a steady upward trend in recent months. With a nearly 70 percent surge over the last two years and a 19 percent gain in the past 12 months, the stock is now hovering just 9 percent below its 52-week high of ₹ 229.90, last seen in August 2024. Recent product launches, improving financials, and optimistic guidance have piqued investor interest—leaving one big question: can the rally sustain? Nykaa's stock closed at ₹ 209.85 recently, marking a 2.3 percent gain for June—its fourth consecutive monthly advance. It rose 4.5 percent in May, 8.5 percent in April, and surged 12.8 percent in March. This consistent climb follows a 6 percent dip in February, offset by a modest 3 percent gain in January. The stock's recent strength comes as it rebounds from a 52-week low of ₹ 154.90 touched in March 2025. The momentum also coincides with the launch of Nykaa Now, the company's new quick commerce platform for beauty products. Already operational in seven cities, Nykaa Now promises order deliveries within 30 to 120 minutes, positioning Nykaa competitively in the fast-delivery beauty space. Looking ahead, Nykaa has outlined a bold expansion plan, targeting three to four times growth over the next five years. The management expects the fashion business to achieve EBITDA breakeven by FY26, with margins expanding to mid-single digits by FY28. For its core Beauty and Personal Care (BPC) vertical, Nykaa is aiming for steady-state EBITDA margins of around 10 percent. The second half of FY26 will also see several marquee product launches, aimed at bolstering growth further across both BPC and fashion segments. Several brokerages have weighed in on Nykaa's latest roadmap, offering cautious optimism. Nomura sees Nykaa's BPC segment well-positioned to deliver 27 percent and 25 percent revenue growth in FY26 and FY27, respectively, citing its strong premium beauty presence. However, it remains conservative on the fashion business, labeling management's expectations as 'ambitious,' especially given the 'high level of competition.' The brokerage forecasts fashion margins to stay negative at -7 percent by FY27. Nomura has maintained a 'Neutral' rating with a DCF-based target of ₹ 216, calling the current valuation of around 5x FY26 EV/sales fair. JM Financial sounded more upbeat, particularly highlighting faster-than-expected breakeven guidance in fashion. It noted Nykaa's aggressive growth in BPC and fashion, along with strong traction in its eB2B Superstore vertical. The brokerage expects stable contribution margins in BPC and EBITDA margin expansion driven by operating leverage. It retained a 'Buy' rating with a March 2026 target of ₹ 250. Nuvama Institutional Equities echoed similar sentiments, focusing on the company's long-term potential and profitability roadmap. The brokerage said Nykaa's BPC segment is expected to grow at a mid-20 percent CAGR between FY25 and FY30, while the fashion division should reach EBITDA breakeven in FY26. Nuvama also noted the potential of Nykaa's private label vertical 'House of Nykaa,' which targets a GMV of ₹ 6,000 crore by FY30. It expects further improvements in profitability from lower losses in fashion and B2B operations and retained a 'Buy' rating with a DCF-based target price of ₹ 235. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

Nykaa's premium bet: A beautiful strategy if it delivers
Nykaa's premium bet: A beautiful strategy if it delivers

Mint

time30-06-2025

  • Business
  • Mint

Nykaa's premium bet: A beautiful strategy if it delivers

FSN E-Commerce Ventures Ltd's analysts meeting last week highlighted that the Nykaa parent is laying the groundwork to scale profitably even as it navigates India's patchy discretionary demand. After a 30% rise in FY25 GMV, Nykaa is now targeting mid-20% growth in its beauty and personal care (BPC) business over the next five years. It aims to drive penetration, catalyze premiumization and deliver convenience. The plan involves scaling physical reach across tier 2 and tier 3 markets. Store count is to rise from 237 to over 500 by FY30. Nykaa is also leaning on regional influencer marketing, tapping over 28,000 influencers to boost brand discovery. Premiumization is key. Nykaa's premium users spend nearly nine times the platform average, with the top 10% spending nearing $395 annually, comparable to developed markets. It is strengthening this segment with a broader product portfolio, high-end sub-brands and immersive digital and in-store experiences. For faster delivery, its two-hour fulfilment model 'Nykaa Now' is live across seven metros. This complements an expansive network of 44 warehouses and 40+ rapid hubs, enabling same- or next-day delivery in key cities. Yet, fashion, the historically weak link, needs close monitoring. Management reiterated its FY26 Ebitda breakeven and mid-to-high single-digit margins by FY28 target, stabilising at around 10% thereafter. Fashion net sales value is expected to grow 3–4x in the next five years, helped by higher own-brand contribution, better repeat behaviour and falling acquisition costs. Nykaa's fashion average order values are already twice the industry average, skewed towards Gen Z and millennial users. Still, fashion remains a highly competitive and discount-driven space where sustaining margin improvement will depend on sharp execution and continued customer stickiness. The GMV of in-house brands is expected to rise from ₹1,700 crore in FY25 to ₹6,000 crore by FY30 in beauty alone. These offer stronger contribution margins and greater customer ownership. Flagships like Dot & Key, Kay Beauty, and Nykaa Cosmetics are expanding overseas. Also read | Nykaa to expand rapid delivery service to more metros as quick commerce takes off Nykaa's FY25 revenue rose 25% with Ebitda margin expanding 60 bps to 6%, aided by operating leverage and a richer product mix. But scale brings challenges, from managing a wider retail footprint to sustaining growth across verticals. While peak investment in warehouse and office infrastructure is behind Nykaa, balancing growth with efficiency would have a bearing on near-term profitability. Plus, when demand is muted, even a minor execution error could dampen investor sentiment. Steady delivery is crucial for the stock that is up around 25% so far in 2025, making valuations pricier to that extent.

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