The initial public offering (IPO) by Nykaa, which was founded eight years ago, will be the first by an online beauty marketplace in India, as per the Mint report. It is expected that the company will first look at achieving overall profitability this year before going public. Considering the boost in business after the lockdown and consumer shift towards digital, the company might look at a listing of much more than $3 billion in valuation, as per the report.
What are Nykaa's investment so far?
The Mumbai-based firm had earlier raised an undisclosed amount from Boston-based asset management firm Fidelity Investments Inc in November through a secondary transaction in India, providing a partial exit to early investors and employees. This took the valuations of the the company at a little over $1.8 billion , as per the report.
In 2018, Nykaa founder Falguni Nayar had shared plans of opting for an IPO by 2020 or so. However, the pandemic proved to be a set back for many such online firms. The company crossed a billion dollars in valuation in March 2019 when it raised ₹166 crore in a primary transaction from Steadview Capital at a valuation of $1.2 billion.
After its November deal with the Fidelity, Nykaa had stated it clocked a revenue of ₹1,860 crore for the year to March, and aiming for a 40% growth in consolidated revenue this fiscal. The other investors include Lighthouse Advisors and TPG Capital.
As per domain experts the beauty platforms such as Nykaa have enough space to grow in the beauty and personal care market, especially given the gap in supply and latent demand in the premium and mass segment. Such players have been able to solve the supply gap though an omni-channel route along with its deep and wide product portfolio and consistently high availability.