FSN E-commerce or Nykaa, as its popularly known, was profitable before it went public and that remains the case for the online fashion and personal care retailer. This is unusual for a digitally-driven startup, since the sector focuses on growth rather than profits.
However, like all startups, Nykaa was very highly valued when it went public and it listed at Rs 2,018, a big premium over its issue price of Rs 1,125 in November 2021. According to some calculations, it was believed that the company would need to maintain a revenue compounded annual growth rate (CAGR) of 25 per cent for 20 years with earnings before interest, tax, depreciation and amortization (Ebitda) margin of 20 per cent to justify the share price.
There have since been complex movements in the stock. The initial public offering (IPO) had a lock-in period for pre-IPO investors, which ended in November 2022.
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