Whalesbook
FSN E-Commerce Ventures, the parent company of beauty and fashion e-tailer Nykaa, saw its stock price jump 4% on the Bombay Stock Exchange (BSE) on Thursday, reaching a 52-week high of ₹285.65.
While the stock saw some gains trimmed by mid-morning, it continued to trade higher, up 3.12% at ₹282.95, outperforming the broader BSE Sensex which posted a modest 0.17% gain.
Strong Fourth-Quarter Results Fuel Rally
The market enthusiasm was driven by Nykaa's impressive financial results for the fourth quarter ended March. The company reported a net profit of ₹79 crore, a significant jump from ₹19 crore in the same quarter last year. Revenue from operations also grew substantially, increasing by 28.4% to ₹2,648 crore from ₹2,062 crore year-over-year.
Brokerages Boost Price Targets
Leading financial analysts have reacted favorably to Nykaa's performance. Nomura initiated coverage with a 'Buy' rating and set a price target of ₹317, up from its previous ₹305 estimate. The firm cited strong revenue growth and potential for margin expansion. Nomura also revised its earnings per share (EPS) estimates for FY27 and FY28 upward by approximately 8% and 7%, respectively, and increased Ebitda margin forecasts by 20 basis points for both years. The brokerage anticipates sustained growth in Nykaa's beauty and personal care segment, highlighting opportunities from premium brands and AI efficiencies.
ICICI Securities maintained an 'Add' rating, increasing its price target to ₹310 from ₹280. The firm noted the strong fourth-quarter performance across both beauty and fashion divisions. Nykaa's beauty segment's net sales value (NSV) grew by 29.1% year-on-year, boosted by premium offerings and growth in Korean beauty and derma cosmetics. The fashion segment reached breakeven for the quarter, with NSV rising 42% year-on-year, signaling effective cost management. Despite potential near-term caution from management due to geopolitical factors, ICICI Securities remains optimistic about Nykaa's medium-term growth.
JM Financial Institutional Securities issued a 'Buy' recommendation with a raised price target of ₹335. The brokerage projects a consolidated Ebitda compound annual growth rate (CAGR) of around 50% between FY26 and FY29, driven by significant margin improvements in both the beauty and fashion segments, indicating strong earnings potential for Nykaa.