The style enterprise of FSN E-Commerce Ventures Ltd (Nykaa) is exhibiting indicators of revival after a number of quarters of modest efficiency.
In Q2FY26, this vertical is predicted to ship web gross sales worth (NSV) progress within the increased mid-twenties—its finest efficiency in over a yr, based on Nykaa’s pre-quarter replace.
Early festive season demand and sure discretionary spending pickup following GST cuts might have buoyed gross sales. The inventory responded positively, hitting a brand new 52-week excessive of ₹261.26 on Tuesday.
Catching up
Vogue, as soon as the laggard, is now catching up with Nykaa’s progress engine, the beauty-and-personal-care (BPC) enterprise. Sturdy traction within the core platform—pushed by expanded model assortment and strong buyer acquisition—has helped the phase regain floor.
Internet income for trend is predicted to develop within the low twenties in Q2FY26, in contrast with low-to-mid teenagers progress seen lately. Nykaa’s newest steering expects the style vertical to interrupt even in FY26, with analysts at JM Monetary Institutional Securities projecting this might occur as early as Q3FY26.
Whereas web income progress is slower than NSV attributable to decrease promoting and advertising earnings, sequential enhancements sign a restoration in shopper demand.
The BPC phase continues to anchor Nykaa’s total efficiency. Income and NSV are projected to develop within the mid-twenties, extending a multi-quarter streak of double-digit enlargement. “Home of Nykaa” manufacturers, together with home-grown names comparable to Kay Magnificence and Nykaa Cosmetics, and purchased labels like Dot & Key, stay key progress pillars. Development is powered by the corporate’s means to scale owned manufacturers whereas sustaining a large market presence.
Margins watch
After a 23% consolidated income leap in Q1FY26, Nykaa expects Q2 progress to stay within the mid-twenties, with consolidated gross merchandise worth (GMV) progress possible near the thirties.
“Regardless of increased revenues, commercial earnings as a share of gross sales may be decrease, resulting in regular Ebitda margins at ~6.7% (+20 foundation factors quarter-on-quarter) in Q2FY26F, with full-year estimates at ~7.2%/8.4%/9.3% in FY26F/27F/28F,” mentioned Nomura Analysis in a report on 6 October.
Nykaa would want to scale margins in H2 to fulfill Nomura’s projections. In Q1FY26, margins stood at 6.5%, up 102 bps year-on-year.
In the meantime, on this calendar yr to date, the Nykaa inventory has jumped 56%. For a corporation straddling two fast-growing shopper segments, festive demand and rising formal spending present well timed tailwinds. Nonetheless, rising competitors, increased customer-acquisition prices and execution dangers in scaling the style phase might spoil the get together.
