Nykaa owner FSN E-Commerce Ventures has kicked off the year with a surge in profits driven by premium brands and strong consumer demand.
Profits at the Indian beauty retail giant grew to 233.2m rupees ($2.66m) in the first quarter of the financial year to the end of June up from 96.4m rupees.
Revenues rose 23% to 21.55bn rupees in the period, with beauty revenue up 24% to 19.75bn rupees.
The company said in a statement this was driven by “strong all-round performance across e-commerce, retail stores, eB2B distribution and House of Nykaa portfolio”.
Meanwhile, platform growth was “fuelled by consistent focus on deepening penetration and premiumisation, as is evident in strong new customer acquisition and improving AOV [average order value].”
Nykaa’s added Chanel, Armani Beauty, Supergoop!, Anua, Aestura, Chantecaille and Paula’s Choice to its assortment of brands.
This helped its beauty customer base grow to 37m, an increase of 29% on the same period last year.
Retail space was a key driver of growth and premiumisation, and grew by 36% in the first quarter, reaching 250 stores.
This included the roll out of larger flagship stores offering services in hair styling, nail spas and makeovers, making them destinations for “beauty edutainment”.
Bollywood actress Sharvari Wagh was announced as Nykaa’s new brand icon in the period, “building a strong connection with Gen Z and millennial audiences” and “deepening the brand’s relevance across campaigns and content”.
Nykaa Luxe, which includes brands such as Charlotte Tilbury, Estée Lauder and MAC Cosmetics, also named Indian-Australian actress and model Lisa Haydon as “muse” to strengthen its position in prestige beauty.
GMV [gross merchandise value] for own-brand DTC skin care brand Dot & Key grew 100% year-on-year to 15bn rupees, while Nykaa Cosmetics GMV hit 3.5bn rupees with new products contributing 20% of sales.
Kay Beauty, the brand from actor Katrina Kaif, grew 56% in terms of GMV to 2.5bn rupees and is due to launch at Space NK in the UK.
Nykaa has also taken full ownership of Nudge Wellness, the Nutrition brand in which it already held a 60% stake.
“This quarter’s performance underscores Nykaa’s ability to consistently balance growth and profitability across both our beauty and fashion businesses,” said Falguni Nayar, Nykaa’s Executive Chairperson, Founder and CEO.
“Our GMV for the quarter grew 26% year-on-year to 41.82bn rupees, supported by accelerated premiumisation and deeper market penetration.
“Since our IPO, we have consistently delivered mid-20s growth at a consolidated level.
“Our cumulative customer base now stands at 45 million, reflecting the growing trust and adoption of our platform.
“The House of Nykaa Beauty business also continues to scale rapidly, driven by successful new launches and strong consumer demand, now contributing 18% of our overall beauty GMV – a clear testament to our brand-building strength.”
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