Beauty and Personal Care E-commerce company Nykaa shares surged 5 per cent in early trade on April 8 after the company painted expectations of a strong growth outlook in Q4.
FSN E-Commerce Ventures Ltd. expects revenue growth to be in the “high twenties” during the January-March quarter on a year-on-year basis, it said in its quarterly business update.
For the quarter under review, Nykaa reported growth in the “early thirties” in its Gross Merchandise Value. GMV is the value of goods sold through e-commerce platforms and is calculated prior to deduction of any fees, expenses or taxes.
The company also expects its Net Sales Value to grow in excess of 25 per cent on a year-on-year basis, similar to its revenue growth. Net sales value refers to the gross sale of a business minus its returns, allowances, and discounts.
Nykaa wrote in its business update that strong customer demand resulted in healthy volume growth led by strong offtake from key categories like makeup and skin.
For the Beauty and Personal Care segment, Nykaa’s GMV is likely to grow around 30 per cent year-on-year, with Net Sales Value growth in the “mid-twenties.” This NSV growth, according to the company, is ahead of industry growth.
Industry growth for the Fashion segment remains muted, as per Nykaa, but Nykaa Fashion’s GMV is likely to grow in the “high twenties” with NSV growth in the “mid-twenties.”
GMV for the “others” vertical is expected to be in the “mid-sixties” with NSV growth of around 80 per cent year-on-year. The “others” vertical comprises mainly of Superstore by Nykaa, which is an eB2B platform.
For the December quarter, Nykaa’s net profit had doubled on a year-on-year basis, with a 22 per cent increase in revenue compared to last year. Its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) margin also expanded to 5.5 per cent from 5.3 per cent last December.
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