Nykaa shares are under pressure as lock-in period ends on November 10

Steadview Capital Mauritius, TPG Growth, Lighthouse India Fund and HNIs such as Harinderpal Singh Banga, Narottam Sekhsaria and Sunil Kant Munjal will be eligible to sell their stake. Promoters Falguni Nairi And the family will also be able to sell 32.4% stake.

During the lock-in period, promoters and investors cannot liquidate the pre-IPO securities that they hold. About 67 percent of Nykaa’s stake will be freed from lock-in.

The stock was under heavy selling pressure before the lock-in expiry. hero Shares had touched record lows of 975 and it’s still down 47 percent year-on-year.

The stock was down 4.91 per cent on November 9 1,076.15 on the BSE while it was down 2 per cent on the NSE.

hero reported consolidated net profit of 5.2 crore during the second quarter of the current financial year (Q2 FY23), more than 330 per cent 1 crore in the year-ago quarter. The company had reported profit of 5 crore in the previous quarter of June 2022.

The company’s revenue from operations grew by more than 39 percent to 1,230 crore 885 crore in the corresponding quarter of the previous financial year, while it was 7 percent higher than 1,148.4 crore quarter-on-quarter (QoQ).

However, analysts say this fall in prices is a good opportunity to buy Nykaa shares.

“The stock has partially corrected due to global technical sell-off on rising yields and the recent imminent lock-in expiry (November 10th). We believe valuations are even more attractive now and due to structural developments in beauty. Appreciates the opportunity and personalized care,” said HSBC Global Research.

“We believe that BPC and e-commerce are the right match and expect 30% CAGR for BPC e-commerce. Nykaa with its pioneering scale, reach and wide product range is in our view a combination of profitability and sustainable exponential growth. Rare combination.” added it further.

It has a ‘Buy’ rating with a target price of 2,170.

“Nykaa 2Q outperformed estimates on GMV, revenue and EBITDA, led primarily by BPC, which enjoyed a strong year-on-year growth. Fashion was modest despite a lower base, highlighting the profitability focus. Under our Ebitda estimates on margin and maintain BUY – expect stock price volatility before lock-up expiration next week,” said Jeffries.

“We upgrade our FY23-26 EBITDA estimates to 24-33% on better margins and continue buying with an unchanged price target. 1,650,” it added.

“While we expect BPC revenue to grow, we believe Nykaa’s journey may be different – ​​it will need to go more mainstream to drive this growth. The growth trajectory in Fashion will be keenly watched. Keep holding; Revised target price: Rs 1,200,” said ICICI Securities.

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.