Nykaa Q3 outlook: Fashion trails as beauty and superstore segments lead growth
FSN E-Commerce, Nykaa's parent company, expects to see strong growth for beauty vertical and superstore as it looks to get its fashion vertical on strong footing.
Beauty and fashion retailer said it expected net revenue growth in the third quarter to be higher than mid-twenties, with a strong performance in the beauty vertical, though demand in the fashion segment continued to remain subdued.
The company said in an exchange filing that the estimated revenue growth was higher than the growth in the gross merchandise value (GMV), indicating positive trend in GMV to net revenue translation.
Nykaa said, for its beauty and personal care segment, GMV growth accelerated compared to previous quarters, with net revenue growth higher than mid-twenties. However, the beauty vertical’s GMV is expected to be in the low thirties, while net revenue from this segment are expected to be higher than mid twenties.
The eB2B distribution business–Superstore by Nykaa, has been expanding rapidly to service around 2,60,000 transacting retailers across 1,100 cities. The segment currently accounts for 8% of beauty vertical’s GMV, as compared to 7% a year ago.
Its fashion vertical is expected to witness 20% net revenue growth while net Sales value is likely to trend around low to mid-teens driven by strong growth in content, marketing and service related income.
“We believe online fashion demand continues to be subdued, but we remain optimistic about the long-term growth opportunity,” stated the filing.
This comes a month after Nykaa Fashion CEO Nihir Parikh stepped down from his position citing personal commitments. The company is yet to announce a successor for Parikh, whose last day was December 5 2024. Nykaa had earlier onboarded Abhijeet Dabas as the Executive Vice President and Business Head of fashion ecommerce to strengthen its fashion vertical.
Edited by Megha Reddy