Nykaa IPO subscribed more than 80 times, retail segment 12.2 times

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The initial public offering (IPO) of FSN E-Commerce Ventures Ltd, which operates the online marketplace for Nykaa beauty and wellness products, was subscribed more than 82 times by the end of the last day of call for ‘offers. Prior to its IPO, Nykaa raised ??2,396 crore from anchor investors. The issue was fully subscribed on the first day of the sale.

According to cumulative auction data from ESB and NSE at 5:00 p.m. today, the QIB segment has been subscribed 92 times; HNI 112.51 fold; retail trade 12.29 times and employees 1.88 times.

The IPO includes a new issue of shares worth ??630 crore and an offer to sell (OFS) of 41,972,660 shares by the promoter and existing shareholders.

According to market watchers, Nykaa shares are available at a slipped premium (GMP) from the previous day but still remain strong around ??570 on the gray market today. The company’s shares are expected to be listed on the major NSE and BSE exchanges on November 11.

“By ensuring the scale of operations, a strong management team, a profitable business and high growth prospects in the industry due to high underpenetration, we believe the company has it. – even created an industry. Therefore, we recommend “Subscribe” to the show for listing as well as long term, ”Hem Securities suggested.

Founded in 2012 by former investment banker Falguni Nayar, as of August 31, 2021, Nykaa had accumulated 55.8 million downloads on all of its mobile applications. Nykaa had posted a net profit of ??61.9 crore in FY21 compared to a loss of ??16.3 crores to FY20. Nykaa opened its first physical store in 2014 and had 80 physical stores in 40 cities as of August 31, 2021.

The company plans to use the proceeds of the IPO for expansion, establishing new retail stores and establishing new warehouses. It also plans to repay some of its debt, which should lower interest charges and further boost profitability.

Brokerage firm Prabhuas Lilladher recommended a “Subscribe” rating to the IPO of FSN E-Commerce Ventures which operates Nykaa. “We believe Nykaa’s entry into the fashion segment is promising with a focus on premium clients, an organized and managed market offering over 1.8 million referrals, private labels like NYKD, Pippa Bella , 20 dresses and industry-leading AOVs ??3977 and ~ 25% contribution to GMV in 5MFY22 “, indicates the note.

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