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Nykaa - Case Study

Nykaa is one of those companies which provide platform to other brands to sell their products, it has foreign brands to sell their products in India.

  • Video / ALAGS

It is quite common, that commissions and profit margin in beauty products is quite high. Generally, running beauty stores is quite costly, they need posh location, great ambience etc. Nykaa solved this problem by starting online, the cost of running a website and app is much lesser than running stores world wide.

However, now Nykaa is expanding in the offline markets. Nykaa aims that any customer who visits their site, should be able to purchase their products. Hence, they have diverse category of products.They stated with beauty products, but then introduced their in-house brands and products.They worked with Indian Actress Katrina Kaif for a product, Kay Beauty. They are also expanding into various industries like The Fashion Industry. Their average customer aquisition cost was around a thousand rupees and it is also worth noting that on average, their customers' cart value is more than 1300 rupees.

They are in 2 segments, Beauty and Personal Care ; and Apparel and Addessories.

  • Nykaa mainly works on Beauty and Healthcare, they work on an Inventory Led Model. They have their warehouses and by their upcoming IPO, they plan to expand their warehouse.

  • Nykaa fashion, which works in Apparel and Assecories Industry, has over 1.8 milion skuS AND 1,350 Brands. The company works online but also has 73 physical stores spread across 38 cities in India.

Competitive Strengths

• One of India's leading specialty beauty and personal care companies.

• Major brands offering their products on Nykaa's platform for sale

• Capital efficient business with strong growth and profitability

• Company's advanced technology platform

• Founder-led company with an experienced management team

Objects of the IPO:

  • 420 Million Rupees for setting up new stores.

  • 420 Million Rupees towards captial expenditure for subsidaries like Nykaa E-Retail, Nykaa Fashion etc and setting up new warehouses.

  • 1,560 Million Rupees for repayment of borrowings.

  • 2,340 million to acquire and retain customers by enhancing their brand visibility and awareness.

  • General Corporate Purposes.

IPO is Open from 28th October to 1st November 2021. Tentative Listing Dates are 11th November. 1 Lot of shares is 13,500 rupees. For some, the IPO is over-valued but it is a unique business so we should consider this fact.

To invest in this IPO, Create your account on Groww- and get 100 Rupees Reward. This is a referral link.

We hope you enjoyed reading about Nykaa. Keep Reading.


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