The public issue of the FSN E-Commerce Ventures is set to open this week from October 28 to November 1, 2021. The company has a diverse portfolio of beauty, personal care and fashion segments under the brand name ‘Nykaa’. It was founded by Falguni Nayar, a former investment banker, in the year 2012.
● The IPO size is going to be around Rs. 5200 crores. This includes a primary issue of Rs. 630 crores and rest being the offer for sale (OFS).
● The price band of the issue is Rs. 1085-1125 per share.
● It is expected to get listed around November 11 and the share allotment process will be completed by November 8.
● Many of the current investors like TPG Growth IV Pve Ltd. and Lighthouse India Fund III are going to sell their stake through OFS.
● The funds collected will be used to invest in subsidiaries. The company will also use the funds to set up more warehouses and retail stores. Some part of the public issue funds will be used for debt repayment, to increase profitability.
● Nykaa has a revenue of Rs. 2440.89 crores, an increase of 38.10% from FY20. It also has an EBITDA of Rs. 161.43 crores.
● It recorded a profit of Rs. 61.95 crores for FY21, compared to loss of Rs. 16.34 crores in FY20.
● The main risk factor associated with Nykaa is the increasing level of competition. As the market will grow, the big brands/companies can enter the market which can impact the market share of the startup.
● According to IPO Watch and IPO Central Data, Nykaa’s shares are trading around Rs. 1775-1805, a premium of Rs. 650-680 or 58-60%.