For the former investment banker. It has been a dream journey so far – the company’s flamboyant stock market debut has already established her as the richest self-made woman in India, with a net worth of around $7 billion.
Upon listing the stock price of Nykaa-run FSN E-commerce, its IPO price on BSE almost doubled from Rs 1,125 to Rs 2,001. It ended its maiden session in the stock market at Rs 2,207 and a market capitalization of Rs 1.04 lakh crore or a little over $14 billion. The bidding for its Rs 5,349 crore IPO had closed on November 1 with an oversubscription of 81.7 times.
The high market capitalization of Nykaa also makes it one of the most valuable stocks on BSE. Its price-to-earnings ratio at the debut-day closing price was 1,588 times, compared to an IPO valuation of 839 times for this online cosmetics retailer.
Why did Nair, who had a toothache in investment banking, choose cosmetics and fashion? Nair says that he entered a field that he knew almost nothing about. “I looked around for ideas and saw that beauty was an underdeveloped market in India compared to the West or Japan and South Korea. It seemed like an opportunity and since we are professionals with no deep pockets, I am one Suryoday wanted to start in the industry before many others jumped in,” she told TOI.
Before ringing the opening bell at the National Stock Exchange on Wednesday, he told the gathered audience, “I started Nykaa at the age of 50 with no experience in technology or beauty or fashion. I hope Nykaa travels to you. You can inspire everyone. The heroine (heroine) of your life.”
She noted that she had an established career that often saw her help entrepreneurs get into the position they are today. He said that when he started Nykaa he saw few believers and many opponents. “The beauty industry was nascent and customers were wary of ordering counterfeit products online,” she said.
After completing degree in commerce from Sydenham College, Mumbai, Nair did his MBA from IIM-Ahmedabad in the 1980s. He spent nearly two decades with Kotak Securities, rising to the rank of Managing Director of Kotak Investment Banking before leaving it to begin his entrepreneurial journey.
Perhaps entrepreneurship was in his blood. She is a Gujarati, born and brought up in Mumbai. His father ran a small bearing company, in which his mother helped him. Nair has previously said that domestic chatter revolves around investing, the stock market and trading.
When asked about her views on the share price, she says it is a combination of the growth potential that investors see in a low market like India and strong unit economics that darkened the company in the last fiscal.
According to the consulting company report, the beauty and personal care market in India is expected to grow at a compound annual growth rate of 12% to $26 billion between 2019 and 2025. redseer, Although the market crashed last year due to the pandemic, it is expected to pick up as more people shop online.
“For an e-commerce company like ours, we have perfect unit economics. We don’t lose, but make money on every order that we service. The balance between acquiring new customers and maintaining unit economics is great. important. If you don’t have that, you dilute your equity to get that growth,” she warns.
Nair says that smaller cities, which account for more than half of the total income, will continue to be the drivers of growth. While 95% of total sales happen online, the rest comes from 80 stores across the country. It is expected to go up 15% as its stores and footfall increase along with the easing of the pandemic. Nykaa had 7.1 million transaction customers in this fiscal till August, up from 5.6 million in the previous year.
Nykaa owns over 1,500 brands with a wide selection of makeup, skincare, haircare, fragrance, personal care, luxury and wellness products for women and men. It has a portfolio of luxury brands which includes bobby brown and Estee Lauder.
The company’s revenue grew 38% to Rs 2,440 crore in the last fiscal, while profit stood at Rs 62 crore against a loss of Rs 16 crore a year ago.
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