Nykaa Shares Slide 5% After Promoter Family Stake Sale Through Block Deal

On Thursday, the FSN E-Commerce Ventures, which sells under the brand name ‘Nykaa’ shares fell 5 percent on NSE which recently saw a significant block deal on July 3, 2025, as early investors Harindarpal Singh Banga and others offloaded around 6 crore shares or 2.3 percent stake at a floor price of Rs. 203.15 per share, as per various sources. This price represented a 4.15 percent discount to the previous closing price of Rs. 211.59, with the total deal size amounting to Rs. 1,200 crore. The transaction was entirely a secondary sale, managed by Goldman Sachs (India) Securities and JP Morgan India Private Limited. 

For FY25, Nykaa reported robust financial performance, with revenue from operations rising 24 percent year-on-year to Rs. 7,950 crore and gross merchandise value (GMV) increasing 25 percent to Rs.15,604 crore. The company’s EBITDA grew 37 percent to Rs. 474 crore, and EBITDA margin improved to around 6.0 percent from 5.4 percent in FY24. The profit before tax rose 84 percent to Rs.127 crore, while net profit surged 80 percent to Rs. 72 crore, reflecting the company’s focus on operational efficiency and cost discipline.

Nykaa’s future plans are centered on aggressive expansion and technological innovation. The company added 50 new stores in FY25, bringing its total to 237 across 79 cities, and aims to double its store count to more than 500 by FY30. 

Nykaa Now, its quick commerce initiative, is live in seven cities and over 40 stores, with plans to expand further. The company is also investing in regional warehouses to enable faster deliveries and reduce logistics costs. Nykaa is also investing in AI and technology to improve personalisation and operational efficiency, with management targeting around mid-20s annual GMV growth in beauty and personal care until FY30. The fashion segment is expected to break even on EBITDA by FY26 and reach a mid-single-digit margin by FY28, and aims for a 10 percent margin in the coming years.

Despite these operational achievements, Nykaa’s stock has significantly underperformed since its IPO in November 2021, which was priced at Rs. 1,125 per share. The stock debuted strongly, listed at Rs. 2,018 which was 79.38 percent higher. However, as of July 2025, Nykaa trades around Rs. 200 to Rs. 211 range, due to a bonus issue. However, it has lost more than 50 percent of its value from the peak.

While the stock has recovered and gained 16.07 percent in the past year, it remains far below its IPO level. High valuation multiples and thin net margins have weighed on investor sentiment, with analysts divided on the company’s prospects. Some see upside if Nykaa sustains strong growth and achieves profitability in its fashion segment, while others caution about rising costs and execution risks.

Overall, Nykaa’s recent block deal highlights ongoing churn among early investors, even as the company posts strong financial growth and pursues ambitious expansion plans. Continued stock underperformance since the IPO has underscored market concerns over sustained profitability, valuation, and execution, making the next phase of Nykaa’s journey crucial for regaining investor confidence.