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NYKAA Valuation 

About Firm & it's Business Model

Financial Summary

Future Prospects

NYKAA Valuation

About NYKAA

NYKAA is an E - Commerce platform offering range of beauty, personal care and fashion products. It's an Indian brick and click firm under FSN E Commerce Ventures Lt. , launched in 2012, in 2020 it became the first Indian unicorn start-up headed by a woman. It retails over 2,000 brand and 200,000 products across it's platforms. With a Market Capitalization of 523 billion INR as of 2025, NYKAA stands as a leading company in cosmetics and personal care market in Indian Personal and Beauty Care sector, currently holding approximately 25 - 30 % of market share.

Vision : Bring Inspiration and joy to people everywhere, everyday.

Mission: To create a world where our consumers have access to a finely curated, authentic assortment of products and services that delight and elevate the human spirit 

Business Model

NYKAA operates on an inventory based method of e-commerce that involves the company buying bulk products from authorized sellers and brands, storing the products in warehouses, which allows for better control over quality and authenticity, two key drivers in BPC segment. Unique feature that helped NYKAA establish user trust, was it's omnichannel presence, which allowed consumers to have first hand look and feel, establishing trust in brand.

In India, Foreign Direct Investment (FDI) is not allowed in inventory - driven e-commerce models. NYKAA leveraged this regulatory advantage early on to gain a first mover position in market. The major e- commerce players like Amazon could not adopt the same model and run on marketplace driven model, which ensured higher profit margins for NYKAA while guaranteeing the authenticity of products to consumers and allowed for a better control over supply chain.

NYKAA Financial Summary

Firm displays a healthy working capital ratio ranging between 1.2 to 2, indicating it's good capability in maintaining operations and covering current liabilities. However, the declined quick ratio over the period of time below 1 reveals firm's struggle in meeting short term obligations with most liquid assets. Firm has a good financial leverage of around 1.5 on an average. 

From the dip in 2023 of earnings per share, company has shown constant improvement and future projections show a good growth under the assumption that it's operating profit remains on the increasing trend as projected, given the firm's policy of no dividend issues and rather re-investments into business growth. 

The PE ratio of NYKAA, given it's current earnings indicate a significantly high valuation of the stock, attributable to the factors of high future earnings growth potential and projected good profitability margins.

NYKAA Future Prospects

With the recent launch of Nysaa, in the GCC, NYKAA's ambitions extends beyond Indian borders. In coming years, company plans to focus on:

a) Physical Store Expansion: Company plans to expand it's physical store footprint by adding 220-250 locations in coming three years.

b) Exploring Quick Commerce: Company is testing quick commerce with it's pilot program "Nykaa Now", which has been piloted in metro cities of Delhi, Bangalore and Mumbai.

c) Strategic Initiatives: Nykaa is focused on building a strong omnichannel strategy, balancing e-commerce with physical retail and quick commerce. Over the years it plans to build curated experience for it's consumers in it's physical stores. 

Nykaa's future financial prospects appear to be positive with a strong revenue growth and increasing market expansion. It's Revenue CAGR between period of 2025-2029 is projected at 19.7%, exceeding the sector average of 12%. Nykaa's EBITDA margin is expected to increase to 6.4%, with decline in loses from it's fashion segment. 

The target price recommendation is between 170-190 from a long term future growth perspective. Overall it's a hold or add recommendation, even though the stock is currently trading at a premium. Given the strong operating profit margin and revenue increments projected over long term, firm has a promising EPS driven by it's growth prospects.