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Nykaa expects a YoY growth of 22-23% in revenue growth for Q1 FY25, with its beauty segment GMV growing in the high twenties YoY. The forecast figures come despite slower physical retail growth and challenges in the fashion industry.
Nykaa's parent company, FSN E-Commerce Ventures Ltd., has announced strong financial projections for the first quarter of fiscal year 2024-25 (FY25). The company anticipates a consolidated revenue growth of approximately 22-23% year-on-year (YoY). This growth momentum is mirrored in Nykaa’s beauty vertical, despite facing challenges in its physical retail and fashion segments.
Nykaa’s beauty vertical, a core component of its business, is set to achieve a robust revenue growth of 22-23% YoY. The segment's Gross Merchandise Value (GMV) is expected to grow significantly, in the high twenties YoY. This performance underscores the long-term growth trajectory of the Beauty & Personal Care (BPC) industry in India.
However, Nykaa's physical retail business experienced slower growth during the quarter, attributed partly to regional factors like elections and heat waves affecting North India.
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In contrast, Nykaa’s fashion vertical faces a more subdued growth outlook. The segment is projected to achieve a revenue growth of around 20% YoY, reflecting challenges within the broader fashion industry.
The demand environment remained muted, exacerbated by seasonal factors such as fewer weddings and festivities during this period. GMV growth for the fashion segment is expected to be in the mid-teens YoY, indicating a more moderate performance compared to the beauty segment.
FSN E-Commerce Ventures Ltd. highlighted that beginning this quarter, Nykaa will adopt vertical-wise segmental reporting. The Beauty segment comprises Nykaa's online beauty platform, owned beauty brands, physical stores, the eB2B distribution business 'Superstore by Nykaa,' and Nykaa Man's BPC business.
On the other hand, the Fashion segment includes the Nykaa Fashion platform, owned fashion brands, the content platform LBB, and Nykaa Man's lifestyle business.
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