Nykaa,
On Wednesday, intraday trade saw shares of FSN E-Commerce Ventures, the parent company of Nykaa, continue to be under pressure and close 2% lower at Rs 125.05 on the BSE. The beauty e-retailer’s stock is trading lower for the eighth day in a row, falling 11% over the course of the period. It is currently close to the all-time low of Rs 120.75, which was reached on January 23, 2023.
Nykaa is India’s largest online fashion, beauty, and personal care brand marketplace. On November 10, 2021, the company made its debut on the stock market. In an initial public offering (IPO), it offered shares at Rs 1,125 each.
In the midst of intense competition and falling share prices, the media reported that five Nykaa executives had resigned last week. Manoj Gandhi, Chief Commercial Operations Officer, Gopal Asthana, Fashion Division Chief Business Officer, and Vikas Gupta, Wholesale Business Chief Executive Officer, all left their positions. notified by Reuters of.
These abdications follow the flight of Arvind Agarwal (ex-CFO) in November 2022 and Reena Chhabra (ex-President Private Name) in August 2022.
According to Nayaka, some of these departures were a part of the standard annual evaluation and change process, in which employees leave for reasons related to performance or to pursue alternative opportunities.
“In our discussion, the administration demonstrated that the general takeoff is little with regards to the size of the organization. Additionally, “some departures are not entirely voluntary because they are based on performance appraisals,” stated analysts at Jefferies in a stock update.
Additionally, management is of the opinion that the Nykaa team is a highly sought-after rival and will therefore be “moderately” attractive. With a combination of internal and external talent, the company will attempt to change this. According to management, the move should not indicate a change in Nykaa’s stance on its businesses, including fashion, eB2B, and own brands, despite the brokerage firm’s ‘Buy’ rating on the stock.
“For a fair value of Rs 200, we value Nykaa’s fashion business at 2.5x FY25E adj sales and its BPC business at 7.5x FY25E sales. “Downside risks include a slowdown in urban discretionary consumption and an increase in the competitive intensity of horizontal and vertical players,” Jefferies stated.
