Nykaa shares rally 3% after Q4 results. What brokerages recommend you should do
Nykaa’s operator FSN E-Commerce Ventures ended Thursday's trade 3% higher on BSE at Rs 174 after hitting the day’s high of Rs 187. The company reported a fourfold Q4 net profit of Rs 9 crore.
The company also posted a 28% year-on-year (YoY) increase in operating revenue for the March quarter to Rs 1,667 crore led by a 24% increase in the core business, beauty and personal care (BPC), to Rs 1,388 crore during the quarter.
After a profitable quarter, brokerages have increased target prices up to Rs 220 for the stock. Here’s what they say:
JM Financial
While the recent demand environment did not seem to be favourable for Nykaa, JM Financial sees the company as a dominant player in a segment with strong secular tailwinds and expects sustained compounding returns.With investments in customer acquisition, the brokerage firm has also raised revenue estimates by 0.4%-0.7% over FY25-29E while slightly lowering EBITDA margins.
JM Financial retained a ‘buy’ call on the stock with a target price of Rs 220.
Kotak Institutional Equities
Kotak Equities stated that the discretionary consumption in FY2024 was lackluster for Nykaa, however the company has grown well in FY2024 and has gained share. KIE raised FY2025-26 EPS estimates by 10-11% largely driven by higher BPC EBITDA estimates, and lower loss assumption in fashion.
They have an ‘add’ rating on the stock with a target price of Rs 195.
Also read: Go Digit share price jumps 9% after muted listing
ICICI Securities
Nykaa grew BPC GMV 30% YoY in Q4FY24 aided by ‘Pink Love
