Beauty and fashion firm FSN E-commerce, which operates Nykaa, recorded a 79% jump in profit after tax (PAT) for the first quarter of the fiscal at Rs 24 crore compared to Rs 14 crore in the year-ago quarter. The profit figure was below Bloomberg estimate of Rs 33 crore.
The Pillars of Profitability
Revenue from operations came in at Rs 2, 155 crore, up 23.4% from Rs 1, 746 crore in Q1FY25, marginally missing estimate of Rs 2, 170 crore.
Earnings before interest, taxation, depreciation and amortisation (Ebitda) was also behind estimate of Rs 147 crore at Rs 141 crore, and was up 46% y-o-y. Ebitda margin for the quarter was 6.5%, up 100 basis points while PAT margin was up 30 basis points year-on-year at 1.1%.
Consolidated GMV (gross market value) for the quarter as declared by the company stood at Rs 4, 182 crore, up 26% from Q1FY25 driven by 26% growth in beauty and personal care (BPC) segment and 25% growth in the fashion segment.
Nykaa’s cumulative customer base grew 30% annually to 45 million at the end of the first quarter, the company said.
Beauty segment GMV grew to Rs 3, 208 crore from Rs 2, 543 crore in the June quarter of FY25 while fashion segment GMV to Rs 964 crore compared to Rs 774 crore in Q1FY25.
Revenue from beauty and personal care (BPC) segment grew 24% to Rs 1, 975 crore and fashion segment revenue grew 15% to Rs 171 crore in Q1.
Annual unique transacting customers in beauty grew 26% to 16.5 million in Q1 FY26 vs. 13.1 million in Q1FY25. The total number of orders in the quarter was up 17% on year at 14.5 million.
During the June quarter, the company added 13 new physical stores to expand its pan-India footprint to 250 stores. The physical stores recorded a 33% growth in GMV annually, and continued to show double digit same store sales growth year on year. The management added that the offline store network is profitable.
The firm’s rapid delivery service is now present in 7 cities, serviced by more than 50 rapid stores and has delivered 1.3 million order till date, the management said.
Building a House of Brands and Going Global
Beauty GMV across Nykaa’s owned brands (as part of its house of brands strategy) rose 70% year on year at Rs 578 crore, and continued to be led by Dot & Key, Nykaa Cosmetics, and Kay Beauty.
Kay Beauty will also enter the international market with its launch at UK’s premium beauty retail chain Space NK in the coming weeks. Falguni Nayar, executive chairperson, founder and CEO, Nykaa, said that Dot&Key could follow.
The fashion brands owned by Nykaa saw a return to healthy growth after a few quarters of muted performance increasing 26% year on year. The management maintained that these brands continued to get significantly better traction on Nykaa platforms.
“This quarter’s performance underscores Nykaa’s ability to consistently balance growth and profitability across both our beauty and fashion businesses,” Nayyar said. The shares of the company were up 0.66% at Rs 204.95 at the end of day’s trading on Tuesday on the BSE. The results were announced after market hours.